Electricity (Miscellaneous Provisions) Bill

Report received.
	Clause 1 [Expenditure relating to British Energy p.l.c.]:

Lord Ezra: moved Amendment No. 1:
	Page 1, line 6, at end insert "in relation to qualifying activities"

Lord Ezra: My Lords, in moving Amendment No. 1, I shall speak also to Amendment No. 6.
	The purpose of the amendments, together with others which will be moved today, is to define and limit the expenditure under the Bill for its defined purposes. Amendment No. 6 is a reworded version of the amendment moved in Committee on 17th March. It is designed to take account of the Minister's remarks (at col. GC3 of Hansard of 17th March) that the purpose of the clause was not to deal with historic liabilities, which is how the original amendment was worded, but to cover ongoing operational expenditure while the restructuring plan was put in place, and in the event of administration should the restructuring plan fail.
	These alternative proposals are being put forward for the company. They have been mentioned on several occasions by the Secretary of State, the Minister and others in public statements and that is confirmed in the Explanatory Notes. That being so, it is important that the operational expenditure referred to in Clause 1 should relate to these two alternative solutions to the company's problems. As this has been firmly reiterated by the Government on many occasions, it is surprising that it does not appear on the face of the Bill.
	It is a simple amendment. It will help everyone to understand what the Bill is about and defines clearly what the expenditures allowed under Clause 1 relate to. I beg to move.

Lord Jenkin of Roding: My Lords, I intervene briefly to say that I warmly support the amendment. Before enlarging on that, I should point out that the Minister, the noble Lord, Lord Sainsbury of Turville, has gone out of his way during the past week to supply noble Lords who have taken part in these debates with extensive explanations of the Government's position. He also invited us to a meeting in his office last Tuesday. I should like to put on record that this has proved extremely helpful and may well shorten today's proceedings.
	As to the point made by the noble Lord, Lord Ezra, there appears to be no limitation whatever on the extent of the operational support that the Government are prepared to give to British Energy in the circumstances in which it finds itself. In Committee, I mentioned that I had been involved, as a Treasury Minister, in the collapse of Rolls-Royce. I should add that I was not Chief Secretary but Financial Secretary at the time. I had forgotten that in that situation no figure, no limitation, was put into the Bill that authorised support for the Rolls-Royce Aero Engines operation and its nationalisation. When we met him, the noble Lord, Lord Sainsbury, made that point very clearly.
	The Minister's argument is that this is a similar case. I am not sure that it is. Initially it is the Government's intention to support British Energy in the plight into which it has fallen to enable it to continue in operation and, as Ministers have repeatedly said, to continue to pay salaries and pensions and for the lights to remain on. We on this side of the House support that approach, but is it to be without limit?
	The Minister's argument is twofold. First, there will be the normal constraints on public expenditure, exercised through the procedures which apply in another place, and the normal Treasury controls. I understand that. His second argument is that the support will have to be approved by the European Commission under the state aid provision. An application was made to the Commission last month for leave to give that support and we are told that the procedure will take many months to complete. In the mean time, the Government's support must continue.
	I do not believe that this situation is the same as the one involving Rolls-Royce. One different aspect is that Rolls-Royce was absolutely essential to the defence of the country. The engines made by Rolls-Royce were used in a great many aircraft, ships, submarines and so on that were needed for the defence of the realm. One can well understand that in those circumstances the costs, whatever they may have been, had be met. Here one is dealing with a commercial operation which has failed, for reasons to which I may refer briefly when we come to the next amendment. Ultimately, there must be some limit to the operational support the Government are prepared to give, although it may be not right to insert a figure. I shall explain the reason for that when we come to the next amendment.
	The amendment of the noble Lord, Lord Ezra, in seeking to define more closely the words that the noble Lord, Lord Sainsbury, himself used in Grand Committee, seems something that the Government could accept in order to reassure people that there will be some control. I remind the House that there has been a great deal of anger on the part of other electricity generators which believe that this is giving this company and this branch of the generating industry an unfair subsidy whereas they have to continue to operate against the stringency of the market without support.
	I should have thought that the Government would be well advised to accept the amendments of the noble Lord, Lord Ezra, in these circumstances, if only to reassure the rest of the industry.

Baroness Miller of Hendon: My Lords, I associate myself with the words of my noble friend in thanking the Minister for the help that he has given us over the past week.
	As the noble Lord will recall, I supported the amendment in Committee. I support it today, and my name is to it. I am well aware that the noble Lord, Lord Ezra, has worked extremely hard to make the qualifying activities more or less the words that the Minister used. But I am also well aware that at our meeting one of his officials suggested that he said more words than were in the amendment. I had intended to speak today purely to say that if there were a few more words, why did the Minister not put something extra in the amendment so that it would be acceptable? However, before I decided to do that I thought it wise to have a jolly good look at the other words and, having done so, I see very clearly why the Minister could not have added them to the amendment.
	It has been very clear from everything that has been said, and from the notes, that the two alternatives are restructuring or administration. However, the Minister said at col. GC3, which I looked at carefully:
	"Finally, it would also allow Government to continue funding the trading arrangements of the operating companies going forward should the restructuring deal fail and should they at any point come into public ownership".—[Official Report, 17/3/03; col. GC3.]
	The Minister was not talking about administration. This is the first time he has referred to coming into public ownership and, frankly, I am surprised at that. If that is really one of the options, it should have been made clear before. Anyway, I understand why he has not added that to the amendment.
	I think that this is a very safe and wise amendment, and I hope that the Minister will accept it.

Lord Sainsbury of Turville: My Lords, I thank the noble Lord, Lord Jenkin of Roding, for his kind comments. I will try to continue to be helpful this morning.
	I do not think there is a radical difference between the Rolls-Royce situation and this one. In both cases there are compelling economic reasons to try to keep the company alive. I should say to the noble Baroness that public ownership in this context is really the same as saying "into administration" because we have made it clear there are no other circumstances in which we would take it into public ownership. We have also made it clear that we think it very unlikely that if it goes into administration a private owner will be found to take it over. So, effectively, I do not think there is any difference in those circumstances.
	The amendments tabled by the noble Lord, Lord Ezra, seek to limit the expenditure that can be made under Clause 1(a) to "qualifying activities", defined as:
	"the ongoing operational support to a British Energy company whilst a restructuring plan is being put in place or funding a British Energy company in the event of its being put into administration".
	Clause 1(a), as noble Lords will be aware, gives government the power to incur expenditure on BE in a number of eventualities. Some concern was expressed in Committee that the provisions in this clause were too open-ended. In fact, this clause has been drafted in such a way as to ensure that the Government have the flexibility to be able effectively to meet their policy commitments in relation to BE.
	Amendment No. 6 seeks to impose certain restrictions on the activities on which government can spend money under Clause 1(a). I am aware that the noble Lord, Lord Ezra, in tabling this amendment, is referring to the clarification that I sought to give when dealing with a similar amendment in Committee. However, I think I should revisit what I said at that time, and place into context the words that the noble Lord, Lord Ezra, has used in his amendment. In Committee I stated:
	"Quite simply, Clause 1 is there to cover other expenditure which is not covered by Schedule 12. Principally, this would concern ongoing operational support to keep BE going during the period when a restructuring plan is being put into place".
	I then went on to explain:
	"The statutory authority provided by subsection (1)(a) could also be used to authorise Government to provide funding in the event of administration . . . Finally, it would also allow Government to continue funding the trading arrangements of the operating companies going forward should the restructuring deal fail".—[Official Report, 17/3/03; col. GC3.]
	It is worth reiterating the point that I made in Committee—Clause 1 is there to cover expenditure that is not covered by Schedule 12. Clause 1 will be used principally, but not exclusively, to provide operational support to keep BE going while the restructuring plan is put into place. Schedule 12 deals only with nuclear liabilities.
	So there is a need to ensure that if the restructuring deal fails, the Government have the flexibility to incur expenditure on BE beyond the support for its nuclear liabilities, which would take place under Schedule 12. The potential activities on which the Government might need to commit expenditure include, but are certainly not limited to, the "qualifying activities" defined in Amendment No. 6.
	We may need, as I stated in Committee, to continue funding the trading arrangements of the operating companies going forward should the restructuring fail and the companies come back to the public sector. If that happened, the Government may need to incur expenditure on BE's nuclear business in a way that we are not able accurately to foresee at this moment. It is important to remain aware of the fact that the restructuring plan has yet to be finally agreed by all parties—or, indeed, approved by the Commission. It would be imprudent to limit the Government's ability to act effectively if the deal fails.
	But even assuming the restructuring is successful, there is reason to keep the flexibility of Clause 1. There is still a lack of clarity over the final detailed form of the deal. Although the principles behind the plan have been agreed, the detailed documentation necessary has not yet been finalised. We have said that the policy intention is that funding for the restructuring would be done under Schedule 12—that is the specific provision for funding nuclear liabilities. But the working up of the detailed documentation may bring to light the need for small items of expenditure to be incurred under Clause 1. For example, I have already explained how—as part of the precautionary measures to avoid handing over a blank cheque—the Government will reserve the right to take back BE's nuclear stations at the end of their life. So we might want to use Clause 1 to purchase the stations at that point, albeit for a nominal sum. Noble Lords should also be comforted by a point I made in Committee; that is, that any expenditure under Clause 1 will be subject to parliamentary scrutiny through the annual Supply Estimates process.
	It is perhaps also worth noting that Amendments Nos. 1 and 6 do not work as drafted as Amendment No. 1 appears to refer to British Energy's qualifying activities, and the "qualifying activities" referred to in Amendment No. 6 appear to be those of the Government in giving financial support to the company. In effect there is some lack of clarity as together the amendments appear not to match. I should emphasise, however, that that is not the main basis of our objection to the amendments.
	To summarise, the flexibility that Clause 1 confers ensures that the Government stand ready to be able to act effectively in a range of scenarios. We do not believe that it would be prudent or sensible to limit an important part of the Government's contingency planning in relation to BE by accepting a restriction in primary legislation on their ability to incur expenditure on the company in the way suggested in the amendment tabled by the noble Lord, Lord Ezra. I therefore ask that the amendment be withdrawn.

Lord Ezra: My Lords, I thank the Minister for that detailed response. I also express my appreciation for the meeting we had the other day. I am a little puzzled, however, at his response to the particular point raised by the noble Baroness, Lady Miller, when he said that public ownership—I refer also to the remarks that he made in Committee—was indistinguishable from administration. If that is so, there can be no objection to my amendment. If the Minister says that effectively administration means that the assets would be in public ownership, that is fine. I refer to the wording of my amendment in which "administration" is used. Therefore, I am a little puzzled by the Minister's comment.

Lord Sainsbury of Turville: My Lords, I hope that I can clarify the situation. The point I was making was that public administration and public ownership do not constitute the same situation. I should perhaps have made clearer that public ownership will take place only after a process of administration. We do not think it likely that anyone would come forward at the administrative stage to buy the company. Therefore, there is not—as I believe the noble Baroness implied—some sinister agenda of circumstances in which we would take the company into public ownership where it had not been through the process of administration. That was the only point I was trying to make.

Lord Ezra: My Lords, it does seem therefore that the wording of the amendment would not restrict the Government in that situation. If what the Minister mentioned is all part and parcel of the administration process, it would be covered. I am still worried about leaving this matter absolutely open-ended. If the situation should change so dramatically that neither of the two solutions now being proposed were to be able to operate, I think that the whole matter should be presented once again to Parliament.
	I should like to reflect on what the Minister said and consider whether some further amendment should be proposed at the next stage. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Jenkin of Roding: moved Amendment No. 2:
	Page 1, line 13, at end insert—
	"(1A) The aggregate of the expenditure incurred by the Secretary of State under subsection (1)(a) shall not exceed the sum of £700 million or such greater sum not exceeding £1,000 million as the Secretary of State may provide by order."

Lord Jenkin of Roding: My Lords, in moving Amendment No. 2, which stands in the names of the noble Baroness, Lady Miller, the noble Lord, Lord Ezra, and myself, I suggest that the House might also discuss Amendments Nos. 3, 4 and 5. I say straight away that these are probing amendments. I do not intend to seek to persuade the House to go into the Lobbies in their support.
	In Amendment No. 2 we have attempted to include some figures to constitute the upper limit of what the Government might spend in two alternative circumstances. The first alternative is that the restructuring works and therefore the company remains in being and the Government's operational support is a temporary phenomenon, as I believe they intend. By the end of the period of the restructuring the company would be solvent and able to meet its liabilities. The second alternative is that the restructuring does not work and the company has to go into administration. There should be some limit—obviously this would constitute a much greater sum—on what the Government would be obliged to spend in order to keep the power stations operating in administration.
	The noble Lord may well ask—as, indeed, he did at our meeting—whether the figures are carefully worked out. I have to say that of course they are not. The first figure in the proposed new subsection (1A) is based on the original support of £650 million with a margin—it is £700 million—but with the power to increase that sum to £1,000 million if the situation demanded. The sum of money would have to be approved by an order in Parliament.
	Much more at large are the figures for the expenditure in the case of the administration not succeeding. In the proposed new subsection (1B) we suggest a sum,
	"of £2,000 million or such greater sum not exceeding £2,500 million as the Secretary of State may provide by order".
	One must look at the background of why this situation has arisen. I shall not repeat what I said on Second Reading or in Committee.
	As the Minister said, clearly managerial mistakes were made by British Energy in the way it conducted its business. However, the underlying cause of what brought the company low was the operation of the new electricity trading arrangement (NETA) as applied by the regulator Ofgem. As the Government have frequently boasted, the wholesale price of electricity has been reduced by 40 per cent. At Second Reading the Minister explained that British Energy fell foul of that as it does not have a retail arm. Many of the other energy producers have a retail distribution business as well and can reimburse themselves for their generating losses by making sure that their retail customers make up the loss in the price. There have been very few significant reductions in price certainly as regards domestic retail customers.
	Some industrial customers are large enough to get the full benefit of the 40 per cent reduction. I am sure that the noble Lord will have seen the report from the Chemical Industries Association which stated that it was doing very well out of that situation, thank you very much. That rings a bit hollow when one recognises that what it is doing well out of is a system that has driven the biggest producer of electricity into serious financial difficulties. One wonders whether the chemical industry would feel the same about a price effect which drove some of its large companies into financial difficulties in circumstances where it could not perhaps expect the support which the Government have given in the situation we are discussing.
	The point I want to make is that there is no sign yet of any let up in the downward price spiral of wholesale electricity prices. British Energy in its present state with the Government's support will have to continue to operate against the background of the extremely low prices it will obtain from its customers. As I said, it does not have a retail arm from which it can reimburse itself for those losses. The purpose of the amendments, therefore, is to ask the Government if they can now give the House some idea of what is likely to have to be spent over the next few years in order to support British Energy against the background of these extremely low prices, no doubt cheered on by trade associations such as the Chemical Industries Association.
	Ofgem, the regulator, was put under an obligation by the Utilities Act 2000 to have regard to the long-term security and diversity of supply. Arguments have been put forward by Mr Callum McCarthy to the effect that one must not regard the possibility of British Energy encountering serious financial difficulties as in any sense his fault. In response, I said that it looks astonishingly different from the other end of the telescope. I do not believe that Mr McCarthy realised, while he was presiding over NETA and driving wholesale prices down, that the effect of that would have such a devastating impact on Britain's largest single electricity producer. Mr McCarthy sought to persuade me that he had regarded and given effect to the obligation. The House may remember that I tabled an amendment during the passage of the Utilities Bill in order to ensure that the chief executive of Ofgem should have regard to the long-term security and diversity of supply. I must say that I found his argument quite extraordinarily unconvincing.
	For the purposes of this clause in the Bill, the fact remains that that is the background against which British Energy must continue to operate, certainly in the months and quite possibly the years ahead. Given that, the Government should give the House some idea of what the Minister and perhaps the Treasury have pencilled in as their likely liabilities over the period. I recognise that in the first instance the sales of Canadian and American assets will have enabled the company to repay some of the loan made by the Government, but it is extremely unlikely whether, in the short term, British Energy will be able to run its business profitably at existing electricity prices, bearing in mind—we shall come to this later in our debates—the payments it has to make in order to finance its nuclear liabilities.
	Please could we be told what the liability is likely to be? What is the sum? The Government must have some idea of what they will have to spend in order to preserve the viability of this company. Before I sit down, perhaps I may remark that I see that Mr McCarthy has been tipped as the next chief executive of the Financial Services Authority. All I can say to that is, God help the banks. I beg to move.

Baroness Miller of Hendon: My Lords, it is clear from all that my noble friend Lord Jenkin has said that he is an expert in this field. I can add nothing to his remarks, other than to say that of course I wholeheartedly support them.

Lord Ezra: My Lords, the House is indebted to the noble Lord, Lord Jenkin, for reminding us so clearly of the reasons why we are in this situation and why the Government have had to step in to help British Energy. There can be not the slightest doubt that it is the way the market has operated through NETA which has brought about this situation, not only for British Energy but, as was mentioned earlier in our proceedings, for many other companies as well. The safety net has not been extended to them.
	It is therefore of compelling importance that we should be told what corrective actions the Government will take as a result of market developments due to the operation of NETA, what those will amount to and what the Government have in mind. As the noble Lord, Lord Jenkin, said, he has tabled a probing amendment with suggested figures to the best that he could calculate. They may or may not be the figures that the Government have in mind, but it would be helpful if the Minister could offer some clarification. Whether that should appear on the face of the Bill is another matter, but we would certainly like to be informed of the Government's thinking.

Lord Tordoff: My Lords, before the Minister replies, I wish to make a remark which I hope is not trivial. I congratulate the noble Lord, Lord Jenkin, on using the words "one thousand million" and "two thousand, five hundred million" rather than referring to those figures as billions, which they are not. On this side of the Atlantic, one thousand million is not one billion; it is one milliard. I am glad to see it used in your Lordships' House.

Lord Sainsbury of Turville: My Lords, I thank the noble Lord, Lord Jenkin, for tabling these amendments and for giving me the opportunity to clarify a little further our intentions in relation to this clause. I shall try to give him the best information that we have at this stage. However, I should say, first, that our recent support took the form only of a temporary loan. We are striving to achieve a restructuring of British Energy which, once the burden of the nuclear liabilities has been removed and alongside the restructuring of the company's debt, should mean that the company is financially viable, with no ongoing need of a subsidy for future operations. On that basis, British Energy's nuclear stations should be economic, even at the current low electricity prices.
	I turn now to the detail of what we think government expenditure is likely to be. Amendment No. 2 refers to expenditure under subsection (1)(a). Perhaps it would be useful to remind noble Lords of the main areas in which we think we would use this provision and how we foresee it working.
	The first area is in relation to our loan to the company while the restructuring plan is put in place. The figure of £700 million referred to in the amendment is, I think, a reference to the loan facility that we have in place with British Energy. This loan facility was previously subject to a limit of £650 million. That figure was always a maximum limit. There was no question of us simply handing over £650 million to the company to do with it as it saw fit. Rather, the loan facility was subject to various controls to ensure that the loan was the minimum necessary. Furthermore, following the sale of the company's stake in Bruce Power, it repaid the loan. We continue to make a facility available, but its total size has been significantly reduced to £200 million on a contingency basis in case of a requirement for further trading collateral or working capital.
	The second anticipated use of the provision would be in funding an administration of the company if, for whatever reason, the restructuring plan failed. The Government have said previously that, under administration, they would make sufficient funding available to the administrator to enable him to continue running the company by providing a loan towards the working capital and collateral required for its electricity trading. Also, we would of course need to pay the extra costs incurred by the administrator in running the business.
	It is difficult to put a precise figure on the cost involved in an administration. Key factors would be the length of time that the company was in administration and the complexity of the task. Clearly, it is our intention to try to minimise the costs as much as possible. That is one of the key reasons why we wanted to bring forward the provisions set out in Clause 1(1)(b) and (c) and in Clause 2. The better prepared we are for the possibility of acquiring the British Energy nuclear business from an administrator, the quicker the administration could be concluded and the lower the costs of administration. However, the fundamental economic position would still be the same; that is, that the nuclear stations themselves are economic to run. Our support would still take the form of a loan, ultimately repayable by the company once it was back on its feet.
	The third anticipated use of the provision in subsection (1)(a) would be in funding a British Energy company if it had been acquired as described in paragraph (b)(i). At this point it is probably worth bringing in Amendment No. 3 since there is a close parallel. Amendment No. 3 deals with subsection (1)(b) and (c) which are contingency provisions aimed at ensuring that we have parliamentary authority to incur expenditure on acquiring British Energy's nuclear business and running it if that proves to be necessary. The power in subsection (1)(c) is analogous to the power in subsection (1)(a), but ensures that we could fund the company's nuclear business if we bought it through an asset purchase, as foreseen under paragraph (b)(ii).
	Of course we have already made clear that the Government would contemplate acquiring British Energy's nuclear business only if the restructuring plan failed, the company went into administration and no other private sector purchaser came forward.
	How much do we expect that to cost? In relation to the first element—the acquisition cost—I should point out that the administrator would be under an obligation to the creditors to achieve fair value in any sale of the subsidiary companies or their assets. I do not intend to be drawn on a specific price, as that would inevitably be a matter for negotiations of a commercial nature with the administrator if it ever happened. However, I point out that in our view the fair value of the nuclear business would be low, given that the nuclear power stations currently have significant nuclear liabilities attached to them.
	The second element is ongoing funding for the nuclear business if it were acquired back into the public sector. We would see that as a contingency measure. If it proved necessary to acquire the nuclear business, we would still need to develop a proper restructuring plan for it. I expect that that would be based on support for the historic nuclear liabilities of the business, similar to that currently envisaged. I explained in Committee that British Energy's estimate of its nuclear liabilities was £5.2 billion, discounted at 3 per cent, of which £2.1 billion is for the historic spent fuel.
	That support is likely to be most suitably given under Schedule 12 to the Electricity Act 1989 rather than Clause 1 of the Bill, as it would be about nuclear liabilities. Even though the company might be in the public sector, the intention would still be that it should pay its own way going forward. It would be our intention that any support for the company under Clause 1 would be of a short-term nature, to allow the company to keep trading until the restructuring could be implemented. The amount would depend on the circumstances, but I expect that it would be along similar lines to the loan facility that we put in place in September. I would certainly hope that it would not require funding at the level anticipated in Amendment No. 3.
	That is about as much information as I am able to give at this stage. I hope that the noble Lord feels that his probing has produced the information that he wanted and that, on that basis, he will withdraw his amendment.

Lord Jenkin of Roding: My Lords, will the Minister give the House his view—it can be no more than a view—as to whether British Energy will be able to operate profitably with electricity at the price of about £16 per megawatt hour?

Lord Sainsbury of Turville: My Lords, I thought that I had covered that. It is our view that the nuclear stations will be economic even at the current low electricity price.

Lord Jenkin of Roding: My Lords, my amendment has produced much more information from the Government than we had hitherto. I am grateful to the Minister for that, and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 3 to 6 not moved.]
	Clause 2 [Removal of restrictions on capacity to acquire certain securities]:

Lord Jenkin of Roding: moved Amendment No. 7:
	Page 2, leave out lines 16 to 18.

Lord Jenkin of Roding: My Lords, grouped with Amendment No. 7 is an amendment that I tabled yesterday, Amendment No. 7A.
	The point is quite a simple one. As we argued strongly both at Second Reading and in Committee, the use of the words "of any company" at the end of subsection (1) appears to leave it open to the Government to buy up any company that they wish in the industry. In Committee, and subsequently in correspondence and at our meeting on Tuesday, the Minister explained at great length that the provision would not be interpreted by the court as having that meaning. He also went on to make it very clear that the Government have no intention of buying up any other companies. Coming from him, we accept that that is their present position.
	The provision is still open to the possibility that it may be misinterpreted, however. Amendment No. 7A is an attempt, following our discussion on Tuesday, to make it clear that the subsection is there to avoid the doubt that the repeal of the two sections of the 1989 Act could somehow have altered the Government's overall position as a purchaser of last resort. I will not press Amendment No. 7, but I want to move Amendment No. 7A. I beg to move.

Lord Brabazon of Tara: My Lords, I should point out that if Amendment No. 7 were agreed to, I could not call Amendment No. 7A.

Lord Sainsbury of Turville: My Lords, I thank the noble Lord for explaining his thinking behind the amendment. I also welcomed the opportunity to discuss informally with him and other noble Lords the concerns around Clause 2(1). I hope that I am right in saying that we have now come to a clear understanding about what we intend with the provision.
	I shall make it absolutely clear. The Government will not gain any powers of compulsory purchase through the provisions in Clause 2(1). The creation of such powers would require a very clear and explicit provision. The purpose of lines 16 to 18 of page 2 is simply to clarify that the natural powers that the Government were able to exercise before the introduction of the Electricity Act 1989 are properly restored once its Sections 72 and 74 are repealed. However, we understand the noble Lord's concerns that that intention is not as clear as it might be in the Bill.
	Amendment No. 7 would remove the clarification given by lines 16 to 18, and we would not agree to that, so I hope that it will be withdrawn. On the other hand, Amendment No. 7A simply serves to clarify our policy intentions. Although I do not think that it is strictly necessary, I recognise that it might help to meet the noble Lord's concerns and I am therefore content to accept it.

Lord Jenkin of Roding: My Lords, I am deeply grateful to the Minister for that concession, which goes a very long way to meet the concerns voiced in this House and in another place about the effect of lines 16 to 18. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Jenkin of Roding: moved Amendment No. 7A:
	Page 2, line 16, at beginning insert "for the avoidance of doubt"
	On Question, amendment agreed to.

Lord Sainsbury of Turville: moved Amendment No. 8:
	Page 2, line 19, after "order" insert "made by statutory instrument"

Lord Sainsbury of Turville: My Lords, I made it clear in Committee that we accepted in principle the amendment to change the scrutiny procedure for the delegated power from negative to affirmative resolution. I have tabled two amendments, Amendments Nos. 8 and 9, which together provide the correct technical drafting for that purpose. Amendment No. 8 makes it clear that the order to be made would be a statutory instrument, and Amendment No. 9 sets out the procedure for approval of the order. The noble Baroness, Lady Miller, expressed concern that that procedure should ensure that both Houses of Parliament had their say, and the amendment of course does that. I hope that she will not move Amendment No. 10. I beg to move.

Baroness Miller of Hendon: My Lords, we are most grateful to the Minister for tabling Amendments Nos. 8 and 9, which we are very happy to accept.

On Question, amendment agreed to.

Lord Sainsbury of Turville: moved Amendment No. 9:
	Page 2, line 24, leave out subsection (4) and insert—
	"(4) Such an order may not be made unless a draft of it has been laid before, and approved by a resolution of, each House of Parliament."
	On Question, amendment agreed to.
	[Amendment No. 10 not moved.]
	Clause 3 [Amendment of Schedule 12 to the Electricity Act 1989]:

Lord Jenkin of Roding: moved Amendment No. 11:
	Page 2, line 37, at end insert—
	"(5) The Secretary of State, in making any grants or loans from time to time under this Schedule (as amended) shall impose such conditions or provide such incentives (or both) as he may in his discretion consider are necessary to ensure that the British Energy company operates its nuclear stations as if it were exclusively responsible for the discharge of nuclear responsibilities."

Lord Jenkin of Roding: My Lords, the amendment is tabled in my name and that of my noble friend Lady Miller and the noble Lord, Lord Ezra. We have been very concerned by the apparently open-ended liability that the Government are taking on for the handling of the nuclear liabilities of British Energy. That has given rise to a good deal of debate, both in this House and in another place.
	The Minister went a long way to persuade us that the restructuring could not be sustained if the other bodies involved—they include the banks, of course, and a great many other people—could not be confident that the tab would be picked up by the Government as British Energy's nuclear liabilities matured. The noble Lord, Lord Sainsbury, argued that the restraints and limitations that we sought to oppose in Committee might threaten the restructuring. We on this side of the House have no intention whatever of doing that and have not repeated our amendments that would put a limit on the amount.
	However, the noble Lord, Lord Sainsbury, assured us in Committee that the Government were determined that the underwriting of the nuclear liabilities of British Energy should not be seen as an open cheque. He was repeating words which have been used more than once by his right honourable friend the Secretary of State for Trade and Industry, who has been clear about that.
	The Minister spelt out in Grand Committee the method that he intends to use in steering British Energy's handling of its nuclear liabilities. He said,
	"the Government propose to put in place a series of controls and incentives to ensure that BE runs its nuclear stations as though it were it were exclusively responsible for the discharge of nuclear liabilities".—[Official Report, 17/3/03; col. GC 31.]
	It is relatively easy to say that, but there could be some difficulties and perhaps some reluctance on the part of the people involved to put that into effect. We therefore propose that those words should be written into the Bill. That is the purpose of the amendment.
	We have added three extra words—"in his discretion"—so that Government may have some flexibility—that is a favourite word of the noble Lord—as to how the provision should be applied. We believe that it is important that all concerned should see on the face of the Bill that that is what British Energy has to do so that the nuclear liabilities taken on by the Government are kept within bounds.
	To use the Minister's own words, our proposal would give "additional discretion". I hope that he accepts the amendment. I beg to move.

Baroness Miller of Hendon: My Lords, there is no purpose in adding the same words as my noble friend. We agree with every word that he said. The Minister was very helpful in trying to address our deep concerns. He has been extremely generous. As my noble friend said, the words that have been put into the amendment were used by the Minister himself, but we added the opportunity for the Secretary of State to use "his discretion", because we are all aware of how much the Minister needs, as well as likes, flexibility.

Lord Sainsbury of Turville: My Lords, the noble Lord, Lord Jenkin, tabled an interesting amendment, which moves the issue on from the discussion in Committee. This amendment refers to an important principle; that is, that the Government, in providing support to BE for its nuclear liabilities, should not take away the economic incentive for BE to operate its stations in a responsible way that would minimise the size of those liabilities.
	We fully support that principle, as we have pointed out on several occasions. However, I do not believe that it would be appropriate to try to convert that principle into detailed legal drafting that would apply through primary legislation.
	The Government are working intensively on the precise details of the undertaking that it will give to British Energy. That binding undertaking would come into effect at the moment the restructuring takes place and will then have long-term effect; that is, over many decades. We are going out of our way to build a number of very detailed controls into this undertaking. There is a whole stream of work on this issue and departmental officials are being advised by external experts on the management of nuclear liabilities. That is all sensible, prudent planning for protecting taxpayers' interests. Having gone to all this trouble, we are not going to change our mind and hand BE a blank cheque telling it that it can have the money with no strings attached. The company itself has agreed to the principle of the conditions which we wish to impose.
	I do not believe that it is necessary to go into this degree of detail in primary legislation. It is clearly right for Parliament to have some form of scrutiny over the Government's management of this process, but that could be properly handled by the existing arrangements of the National Audit Office and Public Accounts Committee. I am sure that something as significant as this undertaking will receive early scrutiny. I hope, with that reassurance, that the noble Lord will withdraw the amendment.

Lord Jenkin of Roding: My Lords, I am grateful to the Minister for that careful reply, which amplifies what he told us when we met him. I certainly understand the points that he made.
	Before I withdraw the amendment, perhaps I could make one extra point. In the very full letter that the Minister wrote to me, which was dated 28th March, he answered the question I had asked in Committee about the Nuclear Liabilities Fund. He spelt the matter out much more clearly there than it had been in any document that I had read. It concerned not only the Nuclear Liabilities Fund, but also the Nuclear Decommissioning Fund. The page and a half of his letter was very illuminating and I think it should be in the public domain. I do not believe that there is anything confidential about it. If I were to submit a Written Question asking about this matter, would the Minister reply—it would be a long answer—setting out what he has set out in his letter to me?

Lord Sainsbury of Turville: My Lords, there would be no difficulty in that. If a Written Question is asked, we will certainly seek to put all that information in the public domain.

Lord Jenkin of Roding: My Lords, I am most grateful for that. It is a matter of wide concern as to how those liabilities will be handled, not only to British Energy, but to the public sector as a whole. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Miller of Hendon: moved Amendment No. 12:
	Page 3, line 24, at end insert—
	"( ) This Act (except for sections 3 and 4) shall expire five years after it receives Royal Assent unless it has been extended from time to time for periods not exceeding two years by resolution of both Houses of Parliament."

Baroness Miller of Hendon: My Lords, this amendment is what is colloquially known as a "sunset clause". We believe that it is necessary because this Bill empowers the Government to spend large sums of taxpayers' money—in some cases, uncapped sums—on the nuclear industry.
	As your Lordships will have seen, we have accepted—sometimes with some reservations—the need for the Government to have such powers. However, in an interview on BBC news on 5th September last year, the Secretary of State expressly disclaimed any intention of seeking a blank cheque from taxpayers for the benefit of British Energy and its shareholders.
	In Grand Committee, the noble Lord the Minister explained the ongoing nature of the commitment that the Government were either having to undertake or underwrite. It is essential that Parliament should have the opportunity, from time to time, to review what has been going on. I also had some general reservations about the Bill as a whole, because the powers that the Government are taking in theory enable the Government to undertake a backdoor process of re-nationalisation. However, the noble Lord has given us quite a lot of comfort today.
	However, the Minister for Energy and Construction admitted in another place:
	"It is true that repealing"—
	Sections 72 and 74 of the Electricity Act 1989—
	"could, in theory, permit the Government to acquire shares in . . . other electricity companies where we cannot currently do so, but I stress that we have no intention of doing so".—[Official Report, Commons, 27/1/03; col. 589.]
	The noble Lord made it clear that where possible he has tried to clarify that it is not quite as bad as we thought.
	As I told your Lordships at Second Reading, and as I repeated in Grand Committee, while I accept what is said to be the Government's present intention, I really would have liked to have put temptation irrevocably out of the Government's way. However, having reached this stage of the Bill, the best I can do is to try to insist that the Government periodically come back to Parliament to account for their actions.
	Your Lordships will notice that in my amendment I have proposed a lengthy initial period—five years—and for extensions for two years at a time. That would not impose any undue strain on the parliamentary timetable. In the Explanatory Notes to the Bill the Government conceded that,
	"In the main, Part 2 [of the 1989 Act] has served its purpose and the provisions no longer apply or are now irrelevant".
	I believe that in time, if British Energy manages to extricate itself from its present problems, this Bill too may no longer apply and may become irrelevant. For that reason it is essential that this Bill should have a "use by" date on it.
	I believe from his response to my amendment in Grand Committee that the Minister is not entirely unsympathetic to what I am trying to achieve. But he did have some reservations, if the Act did expire, about the knock-on effects that that might have on Clauses 3 and 4 lapsing at the same time. He particularly singled out those two clauses. While I agree that the tax clause, Clause 4, has to be protected, I am not so sure if it will be a great loss if the highly technical provisions of Clause 3 were to go when the need for extended financial provision ceases.
	However, cutting the Gordian knot, I am offering in this revised amendment to try to take into account all the concerns of the Minister to save both Clauses 3 and 4 from the effects of the sunset clause. If that does not entirely resolve the Government's reservations—I hope it will, in particular because the Explanatory Notes refer to Clause 2—perhaps I may suggest that as the Government's drafting facilities are much more extensive than mine they could put the matter right at Third Reading. However, the principle of my amendment remains. It is essential that the Bill, by its very nature and aims, should have an expiry date. I beg to move.

Lord Sainsbury of Turville: My Lords, I am grateful to the noble Baroness for taking into consideration the points I made in Committee about the earlier amendment that was tabled seeking to time-limit the Bill. My comments then related to the difficulties in the application of that amendment as drafted to Clauses 3 and 4 of the Bill. Based on that the noble Baroness has now focused her amendment on Clauses 1 and 2.
	Unfortunately, there are still difficulties with this amendment. I hope I did not give the wrong impression in my earlier discussion of the amendment which was perhaps a little brief as it was the last amendment under consideration. My remarks about Clauses 3 and 4 were meant as examples of the problems a sunset clause would cause. I specifically prefaced the explanation with the words "for example". I did not mean to suggest that any concerns related only to Clauses 3 and 4. So while I am grateful to the noble Baroness for clearly taking the trouble to adjust her amendment in the light of the earlier debate, I am afraid that this amendment still creates problems.
	Let us first consider Clause 1. This clause provides specific authority to incur expenditure on British Energy companies. We have already discussed this clause a little today. I am hopeful that there will be no need for this clause in five years' time. But I am not comfortable with putting in such a restriction on the clause, particularly at this stage when we are still working up the precise detail of our legal undertaking to the company. I believe that it is important to retain flexibility here.
	I have stated that our restructuring support to the company will be in relation to its nuclear liabilities and that as a matter of policy this funding would be done under Schedule 12 to the Electricity Act. That remains the case, not least because we have put in place a tax disregard provision that applies to this schedule. But the existence of Clause 1 provides an important safety net. It provides legal certainty that we have statutory authority for our restructuring support to BE, avoiding doubt over whether some element of this support might not be covered by specific authority because it is not quite clear whether or not it falls within Schedule 12. For example, I have already mentioned that having Clause 1 available gives us certainty that we have authority for paying a nominal sum to acquire BE's stations at the end of their life—one of the conditions of our support to BE that we are insisting on in order to protect taxpayers' interests.
	One last point on this clause is that any repeal of Clause 1 would need to be supported by detailed savings and transitional provisions to address liabilities, obligations, and so on, that have been already incurred under that clause. We cannot be sure at this stage what those provisions would need to address.
	I turn to consider Clause 2. The substantive repeal in the first part of subsection (1) would not be affected by a sunset provision as it is clear that a repealed provision remains repealed. The saving provision in the second part of subsection (1) is there, as we have already said, only for the avoidance of doubt and so it should be acceptable there too.
	It may be possible to have a sunset provision on the power to make an order by statutory instrument, but I am not sure it is worth a sunset clause on such a narrow basis. I would also point out that although we would intend to use the delegated power to repeal Part 2 soon, there is always a chance that the need for a consequential provision in respect of such repeal might come to light only later on.
	I know that the noble Baroness is not a fan of the Government's desire for flexibility. Governments are always more in favour of flexibility than are opposition parties, and civil servants value flexibility above all else when they are dealing with such issues. However, I hope that in this case she will understand our desire to retain this flexibility and that she will be willing to withdraw her amendment.

Baroness Miller of Hendon: My Lords, I hope I did not misunderstand—not today—the fact that the Minister had sympathy with the clause; I thought he did. However, now that I have left out Clauses 3 and 4 we seem to have come back to Clauses 1 and 2. So, perhaps I slightly misunderstood in the same way that he may have misunderstood that I do not oppose the Government having flexibility; I am trying to give flexibility but I do not want it to be too wide.
	On that basis, I shall again consider carefully the Minister's comments. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Police (Northern Ireland) Bill [HL]

Lord Williams of Mostyn: My Lords, I beg to move that the Commons amendments be now considered.
	Moved, That the Commons amendments be now considered.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENTS AND AMENDMENTS TO BE MOVED ON CONSIDERATION OF COMMONS AMENDMENTS

[The page and line references are to HC Bill 52 as first printed for the Commons.]

COMMONS AMENDMENT

13 After Clause 13, insert the following new clause—
	"INDEPENDENT MEMBERS: DECLARATION AGAINST TERRORISM
	(1) Schedule 3 to the Police (Northern Ireland) Act 2000 (c.32) (district policing partnerships) is amended as follows.
	(2) In paragraph 1 (interpretation) after sub-paragraph (3) insert—
	"(3A) In this Schedule a "declaration against terrorism" means a declaration in the form set out in Part 1 of Schedule 2 to the Elected Authorities (Northern Ireland) Act 1989, with the substitution of the words "if appointed" for the words "if elected"."
	(3) In paragraph 5 (council's nominations of independent members) in sub-paragraph (4) after "if" insert "(a)" and after "the DPP" insert—
	", or
	(b) he has not made a declaration against terrorism".
	(4) In paragraph 7 (removal of members from office) in sub-paragraph (1) after paragraph (a) insert—
	"(aa) in the case of an independent member, he has acted in breach of the terms of a declaration against terrorism;".
	(5) In paragraph 7 after sub-paragraph (2) insert—
	"(3) Section 6 of the Elected Authorities (Northern Ireland) Act 1989 applies to determine whether an independent member has acted in breach of the terms of a declaration against terrorism as it applies to determine whether a person who has made a declaration required for the purpose of section 3, 4 or 5 of that Act has acted in breach of the terms of the declaration.
	(4) As applied by sub-paragraph (3), section 6 of the Elected Authorities (Northern Ireland) Act 1989 applies with the following modifications—
	(a) in subsection (1), for the words from "after" to "the Assembly" substitute "when he is an independent member of a district policing partnership";
	(b) omit subsection (4);
	(c) in subsection (5), in the definition of "public meeting" after paragraph (c) insert—
	"(d) any meeting of a district policing partnership or a committee of a district policing partnership (whether or not a meeting which the public is permitted to attend), and
	(e) any meeting of a sub-group established under section 21 of the Police (Northern Ireland) Act 2000 or a committee of such a sub-group (whether or not a meeting which the public is permitted to attend), and".
	(6) Subsections (1) to (5) come into force in accordance with provision made by the Secretary of State by order."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 13.
	When we discussed the passage of the 2000 Act it was specifically said by my noble and learned friend Lord Falconer that in due time we hoped to see the day when the various sensitivities surrounding policing issues had receded and then we would be able to return to this issue.
	As your Lordships know, in August 2001 we published an updated implementation plan. On page 11 of that report, in accordance with Patten recommendations 27 and 28, we made it clear that we would consider whether there was a continuing need for the disqualification provision for independent members of DPPs and the functions of the Belfast sub-groups. The plan made it plain that we would consider including any necessary amendments in the subsequent legislation.
	As your Lordships all know, there was a review of policing arrangements. My colleague, Jane Kennedy, met a wide range of parties, including all political parties from Northern Ireland that are represented in this Parliament. We considered the appropriateness of the existing provisions. On 25th November last year the Government published, along with the draft contents of this Bill, some text for consideration. I know certainly that your Lordships appreciated the openness with which the Secretary of State had dealt with this matter. That is the short background.
	I make it plain on behalf of the Government that we see a distinction between on the one hand presenting these clauses to Parliament today for inclusion as part of the legislation—I stress that as strongly as I can—and on the other hand bringing those clauses into force and effect. We did not wish to be in this position and we brought forward these changes with some reluctance. No one pretends that all the problems of Northern Ireland have been solved. However, over the past weeks and months there has been extremely important significant progress. I reiterate my continuing appreciation of the attitude that all noble Lords have adopted as we all work together co-operatively to see what improvements we may bring about genuinely and without partisan feeling.
	As your Lordships know, the Prime Minister and the Secretary of State had discussions at Hillsborough last month. Progress was made. Your Lordships also know that the Prime Minister and the Taoiseach will return to Hillsborough shortly. If the circumstances are right—we all hope and pray that they will be—they will publish proposals setting out the way forward, covering acts of completion as set out in the Prime Minister's Customs House speech.
	Often your Lordships have pointed out to me that we have already had three policing Bills for Northern Ireland. I do not believe that anyone would wish to have a further Bill. But that is not the end of the story. I stress again, at the risk of being tedious, that the provisions dealing with the Belfast sub-groups, which we shall come to later, and these clauses cannot come into force and into effect when the Bill receives Royal Assent. They will be commenced only by means of a subsequent order. Your Lordships know that that will have to be subject to an affirmative resolution of both Houses. That is covered by Amendments Nos. 48 and 49. We shall envisage bringing forward the clauses only in the context of acts of completion. The Secretary of State was even more specific when he spoke last week saying that,
	"They will not come into effect unless we have agreement that those acts of completion have been dealt with".—[Official Report, Commons, 26/3/2003; col. 361.]
	The Prime Minister has made it plain that acts of completion cannot and do not simply mean a statement or a declaration. They must mean giving up violence completely and totally, so that we can move forward with the democratic process, with all parties that wish to be in government abiding by the same democratic rules.
	The affirmative resolution procedure provides an absolute guarantee that Parliament will have the final say as to when those provisions come into effect. My right honourable friend the Secretary of State in another place said that both Houses would have the opportunity for a full debate should an order be brought forward. I give my personal guarantee that I shall make appropriate time available.
	I want to comment briefly on Amendments Nos. 14B, 14C and 48A and, as it also deals with commencement, Amendment No. 15B. They are all attempts, in differing ways, to get at the same effect. Amendment No. 14B, in the name of the noble Lord, Lord Glentoran, and the noble Viscount, Lord Bridgeman, focuses on the issue of decommissioning. I respectfully suggest that it is not the only issue. The noble Lords, Lord Maginnis and Lord Rogan, in Amendments Nos. 14C and 15B approach it in a slightly different way and include a provision for the Secretary of State to add more elements to the list of necessary conditions. I say in a spirit of amity that I do not believe that those amendments are workable. I shall be happy to amplify that in due time should that be appropriate.
	I understand the thinking behind the proposals. In the Government's view we really need a situation where the new world envisaged by the Belfast agreement works properly and as it should. When the institutions are working effectively, and when there is a degree of mutual trust and co-operation—not threats, fear and various intimidation—we shall need to consider the Secretary of State's proposal for Parliament to decide about commencement.
	There will be an element of political judgment. That is inevitable and right in a democratic society. I have detected that there is concern in the House that the decision should not simply be left to the Secretary of State at that stage. That is the important point that favours the adoption of Amendment No. 48A, in the names of the noble Lords, Lord Smith of Clifton and Lord Glentoran. In order for devolution to be restored, trust must be restored, and restored sufficiently to enable all parties to feel able to come together once again in collective government.
	My summary, by way of approval of Amendment No. 48A, is that it is—I mean this as a commendation and not as a criticism—a more subtle and sophisticated way of reaching a conclusion which we all favour.
	Last week Jane Kennedy said,
	"trust must reside not just in the Governments of Britain or Ireland. The parties to the arrangements that we want to re-establish in Northern Ireland will have to make those partnerships work. It is within that context that we would consider the changes being brought forward".—[Official Report, Commons, 27/3/03; col. 541.]
	Therefore, the effect of Amendment No. 48A would be to add another element to the judgment that my right honourable friend the Secretary of State would have to make. For that reason, we are content to accept that amendment. I hope your Lordships will regard that as helpful.
	Amendment No. 14 amends the disqualification provision set out in paragraph 8 of Schedule 3 to the 2000 Act. At present the legislation provides that no one who has ever received a custodial sentence should be allowed to serve—I underline the following words—as an independent member of a DPP, no matter how long ago they were convicted or for what offence or whether or not the sentence was suspended. Our amendment changes that and would provide that a period of five years would have to elapse following a person's discharge in respect of an offence before he or she may be considered for appointment to a DPP.
	If your Lordships accept them, those provisions would bring the rules for independent members into line with the arrangements that already apply to the political members of DPPs, who are drawn from local district councils. Under the terms of the Local Government Act (Northern Ireland) 1972, as amended, candidates wishing to stand for election as local councillors are ineligible for a period of five years following their discharge from an offence that attracted a custodial sentence.
	Those arrangements, in this amendment, mirror for independent members what obtains for local authority members. Similar arrangements, of course, apply in relation to appointment to police authorities in England and Wales, where people are disqualified from being appointed as a member of a police authority if they have received, within five years before the date of the appointment, a sentence of imprisonment for a period of not less than three months.
	The only change to the wording of this clause since it was first published as a text for consideration last November—I referred to that earlier—is to clarify the status of suspended sentences. In line with the equivalent electoral legislation, suspended sentences will not count for the purposes of the disqualification rules unless they are ordered to take effect. The suspension of the sentence will be subject to certain conditions set by the judge. If an individual breaks any of those conditions, the sentence ceases to be suspended and the disqualification provisions would come to bear.
	Those changes would not mean that all ex-prisoners will automatically be suitable for appointment. The Northern Ireland Office Minister at the time of the passage of the 2000 Act through the Commons made it plain that there would be a number of important safeguards. Appointments will be made in accordance with a code of practice issued by the Secretary of State, on merit and by the cross-community Policing Board. The code of practice makes it clear that the board will write to the Chief Constable to ask for confirmation of the criminal records declared by applicants.
	I hope that Amendment No. 13 finds favour with your Lordships because it has been raised, in one way or another, on many occasions. It would bring the arrangements for independent members into line with those that already apply for political members. Prospective independent members would be required, before their application can be considered by the Policing Board, to make a declaration against terrorism, in exactly the same terms as prospective local councillors are required to make. I stress that that has been raised on many occasions in the past, not least by the noble Baroness, Lady Park of Monmouth, and it is extremely important. I commend it to your Lordships.
	There is an important sanction. If an independent member acts in breach or appears to have acted in breach of the declaration against terrorism, it is within the board's power, or the power of the council with the approval of the board, to remove that person from membership. There is a slight difference from the rules applying to councillors. In the case of local councillors, the case must go to the courts before they can be removed. Amendment No. 14 provides that the board—or the council with the approval of the board—should be able to make that decision. Of course, an aggrieved individual could seek a judicial review of the decision of the board or council of removal. The court, on judicial review, would have to come to its judicial conclusion about the reasonableness of that decision.
	There is still scope for the board to take action in respect of political members since existing paragraph 7(1)(e) of Schedule 3 allows the board to remove someone because,
	"he is . . . unable or unfit to discharge his functions".
	I am very glad that the noble Lord, Lord Dahrendorf, is in his place because I come to an important aspect of this legislation. By the courtesy of the noble Lord, I was given—yesterday evening—an early copy of the recommendations of his extremely highly regarded committee. That is what brought me to bring forward Amendments Nos. 48ZA and 49A in manuscript for which I apologise but it was necessary to act quickly. The noble Lord, Lord Desai, spoke privately to me about his concerns. I know that a number of noble Lords around the House take a strict view, first, on the importance of the affirmative procedure; and, secondly, on the unfailing attention we have always given to recommendations of the committee of the noble Lord, Lord Dahrendorf. Therefore, I put down manuscript amendments in my name, having the authority of the Secretary of State to do so, to provide for an affirmative procedure to apply to an order that the Secretary of State might bring forward under the new clause inserted by government Amendment No. 22 which deals with the exceptional arrangements for recruitment of constables with specialist skills.
	We shall come to Amendment No. 22 later in the day but I thought it appropriate and necessary for me to make those remarks at this stage. Amendment No. 22 provides that the exceptional arrangements will be available for two years starting from Royal Assent. The Secretary of State may extend the life of the provision on one occasion only to allow it to operate for a maximum period of four years. Because of the strong views that noble Lords have expressed about 50:50 recruitment, because of the recommendation of the Delegated Powers and Regulatory Reform Committee, we have agreed that the affirmative approach is sensible and proportionate. I therefore commend those two amendments which I think will be unanimously welcomed.
	I do not discount the proposition that the introduction of these changes will be difficult for many. In my opinion, it is undoubtedly the way forward. I have said previously to your Lordships that the more time that passes at present the more confident I become that normality and stability will be achieved for our fellow citizens in Northern Ireland. I believe that there are sufficient, abundant safeguards.
	Moved, That the House do agree with the Commons in their Amendment No. 13.—(Lord Williams of Mostyn.)

Lord Glentoran: My Lords, first, I still hate doing such business on a Thursday morning. At the same time, I thank the noble and learned Lord the Lord Privy Seal and his staff, the Clerks and others who have been so helpful in bringing together the manuscript amendments and other matters in a considerable hurry in the early hours of this morning. I agree with a great deal of what the noble and learned Lord said. It is true that the House and parties have worked together in a positive way over the past few weeks while the Bill has been going through your Lordships' House.
	I do not intend to make a long speech. However, when I last spoke on the Bill I made one point very strongly. My honourable friend in another place, Quentin Davies, although taking rather more time, made the same point. We do not in principle object to the Weston Park clauses. We do not like them; we wish they did not have to be. However, if they are the price of Sinn Fein/IRA, or their scribe P O'Neil, coming to the table and delivering what the world knows they have to deliver in order to have peace and democracy in Northern Ireland, then so be it.
	Her Majesty's Opposition, the Conservative Party, are in total disagreement with Her Majesty's Government over the timing in bringing forward those clauses. We do not consider that it is sensible to continue to meet Sinn Fein demands until they deliver. For those noble Lords who may not have done so, I have read Martin McGuinness's speech to the Ard Fheis. I have read much of Adams's speech to the same gathering. I also read in The Times Martin McGuinness's recent interview. Nowhere did I find any indication of any softening of the stance of Sinn Fein/IRA. The last time I spoke from this Dispatch Box I admitted to being optimistic; perhaps we were moving forward. I believed that. But I was very disappointed by the speeches of Martin McGuinness.
	In practical terms, I also thank the noble and learned Lord for accepting the Liberal Democrat Amendment No. 48A to which I put my name. It is extremely helpful. I know that David Trimble is not happy about it; he rang me. However, I feel happier with that than with nothing. But I stress that it is very much second best. I wish to demonstrate that that is how the Opposition feel about these clauses. I shall seek to divide the House on one, two or perhaps three amendments. How we accomplish that will be fairly complex. I am not certain when I say that I beg to take the opinion of the House but I wish to do so when appropriate on Amendment No. 14A.
	If something exciting happens, or is due to happen, in the near future—that is, before Easter—I shall have been proved wrong in what I have been saying and I shall be delighted. I believe that Her Majesty's Government should not be giving anything at all to Sinn Fein/IRA until they deliver.

Lord Smith of Clifton: My Lords, I, too, thank the Leader of the House, his staff and the Clerks for assisting us with a very tricky piece of legislation. I, too, am not confident that I shall be able to follow the procedures as well as I would have wished.
	We shall be generally supportive of the Government with regard to Amendments Nos. 13, 14 and 48ZA, and so on. The noble Lords, Lord Rogan, and Lord Maginnis, have adopted the wording of an amendment I tabled earlier and subsequently withdrew in terms of Amendment No. 48A which provides a neater formulation. I echo the view of the Leader of the House. At this time, before the package is announced from the two governments in a week or two's time, we must proceed as though things will lead to a restoration of devolution and normality. That is what we are about today.
	I acknowledge that Amendment No. 14C, tabled by the Unionists, which details acts of completion, describes the actions that we would regard as the minimum criteria for accepting that acts of completion had occurred. We still need to see that those things have happened; our withdrawal of the amendment in no way undermines our conviction that those actions from the paramilitaries are fundamentally necessary.
	However, it is not just the Secretary of State and the political parties here in Westminster that must be satisfied by the acts of completion but, more importantly, the political parties in Northern Ireland. That is why we withdrew our earlier amendment and tabled Amendment No. 48A instead. Following the talks at Hillsborough, the parties must go forward together. That is an imperative. The details of the package will be published shortly. Everyone will know where they stand. Each piece of the package will be considered in the context of the other pieces.
	Critical to that is movement on the part of the paramilitaries, but the parties will have to decide whether they can accept the whole package and move forward together, instead of cherry picking. They will have to decide how important are the institutions of government to Northern Ireland. For far too long and on too many occasions, Northern Ireland has had help from outside in order to move on—from the Governments in Westminster and Dublin; from Senator George Mitchell; from President Clinton; and from General de Chastelain. If we can rely on press reports about the package to be published, there will now be an outside body to keep an eye on the parties and ensure that they are all behaving themselves and living up to their responsibilities under the Good Friday agreement.
	All those involved in the peace process have worked tirelessly, and we deeply appreciate the time and effort that they have spent on Northern Ireland, but there comes a time when the political parties in Northern Ireland must themselves take responsibility for the peace process. They must decide whether to move forward together or whether to allow the process to stagnate. They must all take steps to demonstrate that they are acting in good faith and do enough to ensure that that good faith is accepted by others involved in the process.

Lord Maginnis of Drumglass: My Lords, on the first day in Grand Committee, I recall raising the issue of the text for consideration. I was then extremely worried about that text and the concessions that it provided for those who were—and still are—not unequivocally committed to the peace process. I was worried that the text for consideration would be introduced in another place and that we would not have an opportunity fully to discuss the matters arising therefrom. I was assured by the noble and learned Lord the Lord Privy Seal that we would have the opportunity fully to discuss those matters. Whatever was the intention, that is not how matters are working out in effect.
	The Bill as it now appears before us has increased from a 28 to a 41-clause Bill. That is the increase in size since 5th December last year. As amendments show, the Government are introducing a further six new clauses and two new schedules. In the time allocated, Part 2 was virtually unconsidered in your Lordships' House; it was considered only briefly on Report. The schedules were not considered again. In another place, Part 2 and the schedules were raced through without sufficient scrutiny.
	We have here 13 clauses and three schedules that have been virtually unconsidered. That must be of considerable concern for those who recognise the sensitivity of the situation in Northern Ireland. We understand that the Bill, almost in its entirety, is the product of the Government's guarantees and promises, not only to the Social Democratic and Labour Party but specifically to Sinn Fein, at the Weston Park conference. It derives from elements of that conference to which my party was not given access—nor, indeed, were we made aware of the promises that the Government were making.
	Whereas we have some assurances that acts of completion will be required before many of the less palatable aspects of the Bill are implemented, I am not terribly sure about those guarantees. Especially in another place, acts of completion have been described as "processes of acts of completion" or as "in the context of acts of completion". For us to get the sort of guarantee that we require, we need to be told that what is meant by those expressions is "subsequent to acts of completion"; otherwise, we believe that there will be a rush towards handing further concessions to Sinn Fein in the hope that this, that or the next concession will drive the water over the dam.
	The reality is that within the past month, there have been significant finds of new Provisional IRA arms, explosives and explosive devices—new material in hides in Belfast. We have had a period in which the IRA has engaged in the most sinister spying on Members of Parliament, prison officers and police. It has happened so often during the past 30 years that I seldom comment on it, but just this week I have been given information that the IRA is in possession of yet more information about me. I often wonder why that is necessary; I live a fairly open life. None the less, I draw attention to that simply to demonstrate the type of people with whom we hope to deal.
	I am enough of a democrat—my party is sufficiently democratic—to accept that when there are acts of completion, things will be different. I may not like some things that happen. The noble and learned Lord the Lord Privy Seal referred to what happens in England and Wales. Could he illustrate the point by telling us the number of murderers, people convicted of fraud or hooligans—similar to those that we saw outside the football match last evening—who become members of police boards or district police partnerships? The noble and learned Lord knows that that is not a meaningful illustration of what could happen in Northern Ireland, where the political pressures and the need to make political points are such that we will be inundated with applications, should the concessions be made, from the most despicable individuals—the scum of our society, to put it bluntly.
	The reciprocal of that must be to ask whether ordinary, decent, law-abiding members of our community will feel it worthwhile risking their safety by serving on police boards or district police partnerships. Those are some of the questions that need to be posed and, more importantly, answered by the noble and learned Lord.
	Perhaps I am jumping ahead when I refer to the amendment tabled by the Liberal Democrats that has the agreement of the Conservatives in this House but I wonder whether it is recognised that the amendment puts so much pressure on Ulster Unionists in terms of re-establishing the Assembly. Unless we receive, not guarantees set about by process of, or in the context of, but unequivocal guarantees, we shall have to ask whether we can risk re-establishing the Assembly—and I have ever in my political life been an advocate of devolved and responsibility-sharing government—insofar as it may lead automatically to the most undesirable people becoming involved at the very heart of law and order. For them to become involved at the heart of order endangers not only our police, whom we send out to protect society, but the whole fabric of our society and the integrity of the democratic process in Northern Ireland.
	Those are the serious issues that cannot be fully dealt with in the time we have available to discuss the multitude of amendments and business being considered here today. I await with interest to hear how the noble and learned Lord can reassure me and my party on this issue.

Lord Williams of Mostyn: My Lords, I am very grateful to the noble Lords, Lord Glentoran and Lord Clifton, for their remarks at the outset of their speeches when they paid tribute to my private office—which is in fact a single person, Nicki Daniels. There is no Northern Ireland secretariat or Minister attached to the House of Lords, so Nicki Daniels has to do an enormous amount of work—always courteously, cheerfully and efficiently. I am also very grateful for what was said about the officials who had to work very very late last night in seeing to and dealing with amendments of which they were not in possession until well after 8 o'clock in the evening. We should not expect people who are public servants to work in those circumstances.
	I want to go to what was said by the noble Lord, Lord Maginnis, a moment ago. There is no constraint at all on time. Starting at 11 o'clock on a Thursday, we have ample time to discuss all the issues. I have always been able to provide appropriate, decent time for all our considerations.
	Let us go to the fundamentals. The noble Lord, Lord Glentoran, and the noble Lord, Lord Maginnis, said that no concessions must be made to Sinn Fein/IRA. Absolutely. And they are not. The commencement order was written in at the specific initiative of the Secretary of State to meet those concerns. I repeat: Royal Assent does not bring about even the possibility of the Secretary of State taking action. Then it requires the affirmative procedure to be gone through. I have already assured your Lordships that we will have appropriate time to discuss matters at that stage.
	We need to remember this in relation to the mechanism provided by the amendments: can the Secretary of State come to his initial conclusion by way of very fine judgment that it is appropriate to bring in the commencement order? If yes, he has to justify that to both Houses. He knows perfectly well—I say this respectfully to the Commons—that the scrutiny in this House will certainly be informed and detailed, as it always has been. At that stage, we shall have to come to our conclusions as to whether or not his political judgment was correct. I repeat, no concessions have been made.
	The noble Lord, Lord Maginnis, asked—he may know the answer, because he frequently does when he teases me—how many murderers, fraudsters or hooligans serve on British police authorities. He normally takes the police authority for Surrey. I do not know why we always rely on Surrey for these disagreeable examples. The answer is, probably very few—if any. My proposition was not that such people sit on police authorities but that they have the opportunity to do so, should they be qualified—even though they have previous convictions.
	The question resolves itself to these propositions. Do we want to move forward? Are we able to believe that in the not-too-distant future the opportunity will be there? If the answer to those questions is yes, we need to give this power—and it is only a prospective power—for the Secretary of State to adopt.
	I shall deal specifically with the question of the noble Lord, Lord Maginnis, about pressures on the Ulster Unionists if the Smith-Glentoran amendment were carried. It is not pressure on the Unionists. It is giving them and other political parties power and influence about a very significant decision. That is why I ventured to suggest earlier that Amendment No. 48A is very subtle and sophisticated, because it gives power and influence to those parties who, if they do not feel content, will not join in with the re-establishment of the suspended institutions.
	I absolutely agree with the noble Lord, Lord Maginnis, that he has spent a very long life in politics supporting devolved and responsible institutions. We are here providing for the possibility that responsibility may be more widely shared—but only on the basis of demonstrated fact.

On Question, Motion agreed to.

COMMONS AMENDMENT

14 After Clause 13, insert the following new clause—
	"INDEPENDENT MEMBERS: DISQUALIFICATION
	(1) In paragraph 8 of Schedule 3 to the Police (Northern Ireland) Act 2000 (c.32) (disqualification for membership of district policing partnership) for sub-paragraph (2) substitute—
	"(2) A person is disqualified for being an independent member of a DPP if—
	(a) he has been convicted in Northern Ireland or elsewhere of any offence and has had passed on him a sentence of imprisonment or detention, and
	(b) the relevant period has not ended.
	(3) The relevant period is the period of five years beginning with the person's discharge in respect of the offence.
	(4) For the purposes of sub-paragraph (3) the following are to be treated as the discharge of a person (whether or not his release is subject to conditions)—
	(a) his release on licence;
	(b) his release in pursuance of a grant of remission.
	(5) Sub-paragraph (4) does not apply in relation to the release of a person in respect of an offence if he is required to return to prison or detention for a further period in respect of the offence.
	(6) Subject to sub-paragraph (7), the reference in sub-paragraph (2) to a sentence of imprisonment or detention does not include a suspended sentence.
	(7) Sub-paragraph (6) does not apply in relation to a suspended sentence that has been ordered to take effect.
	(8) In this paragraph "suspended sentence" means a sentence of imprisonment or detention that is ordered not to take effect unless the conditions specified in the order are met."
	(2) Subsection (1) comes into force in accordance with provision made by the Secretary of State by order."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 14, to which I spoke with Amendment No. 13.
	Moved, That the House do agree with the Commons in their Amendment No. 14.—(Lord Williams of Mostyn.)

Lord Glentoran: rose to move, as an amendment to the Motion that the House do agree with the Commons in their Amendment No. 14:
	14Aleave out "agree" and insert "disagree".

Lord Glentoran: My Lords, as I have already indicated, I should like to press Amendment No. 14A and take the opinion of the House.
	Moved, as an amendment to the Motion that the House do agree with the Commons in their Amendment No. 14, leave out "agree" and insert "disagree".—(Lord Glentoran.)

On Question, Whether the said amendment (No. 14A) shall be agreed to?
	Their Lordships divided: Contents, 94; Not-Contents, 147.

Resolved in the negative, and amendment disagreed to accordingly.

Lord Geddes: My Lords, before calling Amendment No. 14B, I must advise the House that, if it is agreed to, I shall not be able to call Amendment No. 14C due to pre-emption.

[Amendment No. 14B not moved.]

AMENDMENT TO COMMONS AMENDMENT No.14

14C Line 31, at end insert—
	"(3) The Secretary of State shall not make an order under subsection (2) until acts of completion have occurred.
	(4) In subsection (3), "acts of completion" means—
	(a) that the decommissioning of firearms, ammunition and explosives held by one of the organisations specified under Schedule 2 to the Terrorism Act 2000 has occurred and has been verified under section 3 of the Northern Ireland Arms Decommissioning Act 1997 by the Commission;
	(b) there has been a statement from that organisation ordering the termination of acts of paramilitary violence by that organisation, including—
	(i) shootings;
	(ii) beatings;
	(iii) threats;
	(iv) intimidations; and
	(c) there has been a statement from that organisation removing any threats to those who left their homes due to intimidation by that organisation.
	(5) The Secretary of State may by order add further acts to those listed in subsection (4) above."

Lord Rogan: My Lords, I beg to move Amendment No. 14C as an amendment to Commons Amendment No. 14.
	Noble Lords may indeed express some surprise that I am moving this amendment today. As noble Lords will be aware, it was printed yesterday along with other amendments standing in the name of the noble Lord, Lord Smith of Clifton. I hasten to add that this is not a tabling error. I, too, was surprised to note that the amendment had been withdrawn. However, I would suggest that, until two days' ago, it would not only have received the support of the Ulster Unionist Party but perhaps even the support of the whole House.
	The very notion of convicted criminals sitting on DPPs is a hard pill to swallow for the majority of the people in Northern Ireland. Further, these provisions fly directly in the face of the Patten report. Although the Government have hitherto justified this Bill as if it were implementing Patten in full, this disqualification provision could not be further from Patten. As my colleague, the right honourable David Trimble said in another place last week, according to Patten independent members should,
	"reinforce the credentials and credibility of the DPP as a whole".
	Moreover, according to Patten, they should be selected to,
	"represent business and trade union interests and to provide expertise in matters pertaining to community safety".
	It is difficult to see where Patten's vision of DPPs involved convicted criminals.
	Surely this is purely a move on the Government's part to encourage republicans to join the Policing Board and the DPPs. However good-intentioned that premise may be, it is entirely premature. Clearly, too much trust has been placed on the republican movement to deliver when recent events, which I shall not repeat today, have proved its members incapable of leaving terror and violence behind. We have witnessed no progress on decommissioning. There have been no acts of completion.
	That is why it is entirely reasonable and prudent to include in the Bill a firm assurance that these provisions will not be introduced prior to, or, as Jane Kennedy suggested in another place "in the context of", acts of completion. These provisions should be introduced only after we have seen not only positive signs from the republican movement—and, of course, the loyalist paramilitaries—that they are moving away from violence, but also action.
	As the amendment outlines, paramilitary violence extends beyond the traditional definition of gun and bomb attacks. Acts of completion must also include an end to beatings, threats and intimidation. Those exiled through intimidation must be allowed to return. Is it not sensible to assume that those who wish to join the DPPs should be able to refrain from criminal activity, and encourage others in their community to do likewise?
	The Government have talked long and hard about "acts of completion", but we have yet to see a tangible definition. The people of Northern Ireland remain in the dark as to what acts of completion will involve—how they will be implemented and monitored. It is therefore entirely sensible to tie acts of completion to provisions under Schedule 2 of the Terrorism Act 2000 and Section 3 of the Northern Ireland Arms Decommissioning Act 1997. I beg to move.
	Moved, That Amendment No. 14C, as an amendment to Commons Amendment No. 14, be agreed to.—(Lord Rogan.)

Lord Fitt: My Lords, I fail to see how anyone could have any objections to the amendment just moved by the noble Lord, Lord Rogan. I believe that all Members of this House have been demanding—indeed, if not, they should be—exactly what this amendment demands. The noble Lord made particular reference to the return of exiles who have been exiled by the IRA and who are not allowed to return to their homeland where they were born and reared. At a meeting only last week chaired by the noble Baroness, Lady Park, this subject caused great concern. I see no indication from the IRA, or by way of the demands that have been made, that they will allow such exiles to return.
	When discussing the previous amendments, the noble and learned Lord, the Lord Privy Seal, said that you could discuss the whole Northern Ireland Bill with this set of amendments. The noble Lord, Lord Rogan, made reference to the appointment of independent members to the DPPs. I meant to speak to the previous group of amendments, but I believe that it will be quite in order to mention here the appointment of independent members.
	Everyone knows what "independent" means in Northern Ireland. Whatever people over here may regard as independent, people in Northern Ireland will know the identification of that so-called "independent" member, with his former colleagues, given their experience of having lived for over 30 years with paramilitary activities. The Lord Privy Seal gave an undertaking that before someone is appointed as an independent member he must sign a declaration to the effect that he is opposed to all forms of paramilitarism. That is a very reasonable request. However, a thought crossed my mind as I listened to the noble and learned Lord. We know from Weston Park that we are now to have sitting as independent members, or local authority members, people who have had a very dangerous past as regards their activities with paramilitary groups.
	I read in a recent report from Northern Ireland that there are at present somewhere in the region of 2,000 unsolved murders in the Province. The vast majority of those murders have been carried out by paramilitaries of one side or the other—either the so-called "loyalists", or the IRA. What position would the board be in when making an appointment of a so-called "independent" member when it is found that perhaps 10, 20, or 25 years ago he was guilty of a paramilitary offence right up to and including the most dangerous one; namely, the crime of murder? What happens if he is appointed to a DPP as an independent member? Are the police still carrying out inquiries into those murders? If it is then found that a person sitting as an independent member on a DPP was involved in a paramilitary crime of 10, 20, or 25 years ago, will the police pursue that conviction? Alternatively, will that person be put into the category of the OTRs who, under other legislation, will be given something approaching an amnesty?
	Can the Lord Privy Seal give me and the people of Northern Ireland an assurance as regards those appointed as independent members, who have perhaps no overt connection with former paramilitarism? If it is subsequently found that such people have been involved in paramilitary activities, will they be disqualified from the DPPs? They may have given an indication that they are perhaps not involved in paramilitarism at present. However, although they have not been convicted, they may have been so involved. Would the latter affect their membership of the DPP?

Baroness Park of Monmouth: My Lords, while welcoming the valuable formula of Amendment No. 48A, I was glad to hear that the noble Lord, Lord Smith of Clifton, agreed with this amendment, which I also support. It is right and necessary that what constitutes acts of completion should be clearly defined on the face of the Bill since the texts for consideration are already implicit in it. It is difficult to see how the Government could object. Once these texts are in the Bill, implicitly they will be regarded as a commitment, just as the Weston Park agreement has been regarded as a commitment by Sinn Fein/IRA.
	As things stand, the Government are, not for the first time, allowing Sinn Fein/IRA to set their own agenda, without a shadow of commitment on their part, a bare four days after the interview with Martin McGuinness reported in The Times, in which he,
	"refused to offer firm commitments about the fate of more than a thousand people, most from nationalist communities, who were sent into exile during the Troubles"
	—let alone the thousand sent since the Belfast agreement. Mr McGuinness added that,
	"he would be concerned about the prospect of people coming back into communities and there being a community reaction".
	What arrogance!
	How can the Government contemplate putting virtually all the texts for consideration into the legislation, even though it is suspended, after that? This is supposed to be a Bill to enable the police to function effectively, a Bill about restoring law and order. Unamended, it will be a charter for Sinn Fein/IRA to continue to behave as if they were the only arbiters of the lives of innocent people who have been unfortunate enough to cross the paramilitaries.
	It will be a mockery of justice if we do not spell out what Sinn Fein/IRA must do first if they are even to return into government. The only acts that have taken place have been a long series of acts of terrorism. Would Mr McGuinness be predicting, as he has, that,
	"policing and justice powers could be devolved in a very short period, since there appears to be a consensus"?
	And would Gerry Adams be cheerfully contemplating Sinn Fein/IRA,
	"joining the Policing Board and participating fully in the policing arrangements on a democratic basis",
	if they did not know that commitments have been made—commitments to yield yet more dangerous powers to men whose aim is to destroy the police, men who have been caught red-handed in the last weeks with arms ready primed and clearly intended for use on the streets, not quietly reposing down a hole and put beyond use?
	I commend the amendment to the House. It clearly sets out what must be done unconditionally by SinnFein/IRA, and what indeed I thought was expected of them by the Prime Minister and, I hope, the Taoiseach when the Belfast agreement was signed. It is utterly unacceptable that, five years on, the people are still helpless victims of the paramilitaries and that the police and the courts are virtually powerless to help.
	I do not understand why we cannot wait to make these commitments until we have seen results and then debate them.

Lord Glentoran: My Lords, in my book the amendment that was withdrawn was the best of the amendments, although I must accept the advice of the noble and learned Lord, the Lord Privy Seal, that it was not very well drafted and might not have been manageable. I do not have his legal expertise. To me as a lay person the amendment seemed excellent. I am sorry that it came from the Liberal Democrats and that then they withdrew it. I am complimenting them in one way, while regretting that they did not stay with it. However, we all understand each other. I should have liked to see that amendment, of all the amendments, passed.

Lord Williams of Mostyn: If I may say so without appearing to be patronising, the Liberal Democrat motion primarily in the name of the noble Lord, Lord Smith of Clifton, had the desired effect because it obliged us to concentrate on an important issue to see whether we could accommodate all views and achieve the most appropriate outcome.
	With the best will in the world, Amendment No. 14C cannot be made to work. It says:
	"The Secretary of State shall not make an order . . . until acts of completion have occurred.
	". . . 'acts of completion' means-
	". . . the decommissioning of firearms, ammunition and explosives held by one of the organisations specified under Schedule 2".
	Simply one of them? Why only one? Does,
	"the decommissioning of firearms, ammunition and explosives"
	mean that the retention of a single cartridge for a shotgun by a member of a paramilitary organisation is sufficient to disqualify the Secretary of State from making the order? As soon as one probes the factual consequences of the amendment, one realises that it is not workable.
	In any event, I return to my earlier theme. Acts of completion are not limited to mechanical delivery of weapons. After all, if one wanted to be deeply cynical—I am sure that none of your Lordships would wish me to fall into that category of sin—one could say that decommissioning itself is not the answer. It is part of the answer, but it is not the total answer. As your Lordships have pointed out to me on many occasions, decommissioning of itself means handing over existing weapons; it does not prevent the further acquisition of weapons.
	Therefore, I return to the point made by the noble Lord, Lord Smith of Clifton. What we are looking to is a process that will involve individual acts, but that process and all those processes must be seen as steps to a situation that we are lucky enough to have in England and Wales, namely, democratic politics as the only acceptable form of political or quasi-political activity. Although I sympathise with the noble Lords, Lord Glentoran and Lord Rogan, this is not the way to achieve the desired outcome.
	The noble Lord, Lord Fitt, asked a number of detailed questions. The removal of members from office is dealt with in paragraph 7 of Schedule 3 to the 2000 Act. An independent who does not "make the necessary disclosure" can be removed. If,
	"he has been convicted of a criminal offence in Northern Ireland or elsewhere committed after the date of his appointment",
	he can be removed. That does not deal with the noble Lord's point, because he was asking about a murder that might have been committed 20 years ago. I take his point on that matter. The comfort I can offer the noble Lord is that if the person concerned is otherwise unable or unfit to discharge his functions as a member of the DPP the board or the council can remove him.
	One does not want to use a noble name in vain or inappropriately, but, after all, the first president of the free South Africa had served 27 years in prison for criminal activity. The question is: are we to insist for ever that redemption is not possible? If, five years after discharge—it may be from a very long prison sentence—someone is to be wholly disqualified from the political process in this context, that is an encouragement to people not to seek to remedy their behaviour; it is in fact an encouragement to them to carry on with unlawful activities.
	I repeat what I said earlier: We are only at the preliminary stage. We are not even at the stage of empowering the Secretary of State to make the order. What we are saying is that in due time he may, on affirmative procedure, issue the commencement order. He still has to come to his political fine-tune judgment.
	I recognise the sincerity of the concerns expressed by the noble Lord, Lord Rogan, but I do not recommend to your Lordships that we adopt his proposed course of action.

Lord Rogan: My Lords, I have listened to the remarks of the noble Lord, the Lord Privy Seal. Nevertheless, I wish to test the will of the House.

On Question, Whether the said amendment (No. 14C) shall be agreed to?
	Their Lordships divided: Contents, 91; Not-Contents, 139.

Resolved in the negative, and amendment disagreed to accordingly.
	On Question, Amendment No. 14 agreed to.

Baroness Farrington of Ribbleton: My Lords, I beg to move that further consideration of Commons amendments be adjourned until later this afternoon.

Moved accordingly, and, on Question, Motion agreed to.

Baroness Farrington of Ribbleton: My Lords, I beg to move that the House do now adjourn during pleasure.

Moved accordingly, and, on Question, Motion agreed to.
	[The Sitting was suspended from 1.28 to 2 p.m. for Judicial Business and to 3 p.m. for Public Business.]

Afghanistan: Security of Aid Workers

The Earl of Sandwich: asked Her Majesty's Government:
	How they propose to ensure the security of humanitarian aid workers who operate in regions of Afghanistan outside the capital.

Baroness Crawley: My Lords, employers of humanitarian aid workers are responsible for the safety and security of their staff. Reputable NGOs have detailed safety and evacuation plans and assess the security of their staff regularly. DfID requires that all NGOs it works with have full safety and evacuation procedures in place. We hope that the security sector reform programme currently being undertaken will in time bring improved security for everyone in Afghanistan, including NGO workers. The international and joint civil/military provincial reconstruction teams have an important part to play in that process.

The Earl of Sandwich: My Lords, the callous murder of an International Red Cross aid worker last week brings into sharp focus the lack of security in areas outside Kabul. I thank the noble Baroness for her reply but, as we are seeing now in Basra, will not local people be confused when they see that the new US units—they are called reconstruction teams in Afghanistan—are soldiers in uniform bringing them humanitarian aid? Will not this undermine the trust that people have in their own local Afghan NGOs and in the aid workers, a trust which has been built up over many years?

Baroness Crawley: My Lords, the noble Earl is right. These new reconstruction teams are being set up. Three US-led provincial reconstruction teams have begun work in three provinces outside Kabul. One of the great concerns, not only of NGOs but of everyone concerned about the development of Afghanistan, is that the people in the provinces outside Kabul need to make greater links with the new Afghan transitional government. Reconstruction teams are being set up but they are not intended as primary security forces, although initial indications are that there is improved security in the locations where they are deployed.
	The teams have three aims: to assist in extending the Afghan Government's authority; to develop a stable and secure environment in the regions outside Kabul; and to facilitate security sector reform and reconstruction.

Lord Astor of Hever: My Lords, what effect has the Iraq war had on the recruitment and funding of ISAF? Can the Minister confirm that the Germans and Dutch, the current commanders of ISAF, have threatened to withdraw?

Baroness Crawley: My Lords, I can say categorically that the Iraq conflict has had no effect on the recruitment or budget funding of the International Security and Assistance Force, which is permanently in Afghanistan. There is no question of the Dutch or Germans, who are currently leading ISAF, withdrawing. Every country has a six months' term. UK forces led ISAF for the first six months; then the Turkish forces for six months, and now the Dutch and Germans. When their six months' term comes to an end, another country will take over.

Baroness Whitaker: My Lords, there are conflicting reports about the situation of women in Afghanistan. What is my noble friend's assessment, and what are the Government doing to help them?

Baroness Crawley: My Lords, the whole House will agree that we must ensure that women are fully part of the new political settlement in Afghanistan because of the particular suffering they have endured for so long in that country. There are reconstruction programmes, which we support and are helping to fund, that ensure that women and girls will benefit from the new political and civil society in Afghanistan. For instance, at the moment, out of the 1,600 people in the Afghan Loya Jirgah, 200 are women. It is a first step, but it is an enormous improvement on zero. We recognise the problems and concerns of NGOs and others about reports that women and girls are being attacked, that girls' schools are sometimes under attack, and that there is a lack of healthcare facilities for women and girls. We take these issues very seriously. But 1.4 million girls are now in school in Afghanistan, which was not the case 15 months ago.

Lord Campbell of Alloway: My Lords, does the—

Baroness Northover: My Lords—

Lord Williams of Mostyn: My Lords, it is the turn of the Liberal Democrats.

Baroness Northover: My Lords, given that Afghan clerics have called for a holy war against those who attack Muslim lands, are British aid workers now even less safe in Afghanistan? Does the Minister agree that the Afghan experience generally shows that reconstruction must be a long-term commitment, something we should remember for post-war Iraq?

Baroness Crawley: My Lords, I absolutely agree with the noble Baroness's final point. We have said continually that we are in for the long haul. My right honourable friend the Prime Minister said recently that we are committed to the reconstruction and development of Afghanistan. The security of aid workers is of great concern to the Government—the DfID, the Ministry of Defence and the Foreign Office. Together with the NGOs, we are working all the time to improve security. However, we also try to ensure that NGOs are neutral from the security forces.

Lord Campbell of Alloway: My Lords, returning to the Question on the Order Paper, and having listened with great attention and respect—and some patience—to everything the Minister said, how are we to ensure the security of humanitarian aid workers anywhere without the intervention of our Armed Forces, who have quite a few jobs on their hands at the moment?

Baroness Crawley: My Lords, as I said earlier, we try to secure the safety of NGOs. It is first for the NGOs themselves to feel as safe as possible when operating in a certain locality. Beyond that, in Afghanistan we ensure their safety through the security forces of ISAF and the new provincial reconstruction teams.

PFI Agreements

Baroness Wilcox: asked Her Majesty's Government:
	Whether they will publish a list of all signed private finance initiative agreements.

Lord McIntosh of Haringey: My Lords, we already publish such a list. While procurement issues are a matter for the individual department concerned, departments contribute to a list of signed projects compiled by the Office of Government Commerce, which is publicly available on the Office of Government Commerce website. In addition, a full record of future payments under PFI contracts is published in the Red Book. The relevant tables are: C17, departmental estimate of capital spending by the private sector (signed deals); C18, estimated aggregate capital value of projects at preferred bidder stage; and C19, estimated payments under PFI (signed deals).

Baroness Wilcox: My Lords, I thank the Minister for that Answer. When I think of the £100 billion involved, would it not be better, and does not the Minister agree that it would be in the public interest, to have a comprehensive list available, in a timely manner, in a prominent place, and in a format that is easily accessible?

Lord McIntosh of Haringey: My Lords, the noble Baroness, Lady Wilcox, has simply not listened to my Answer. I am inclined to say to her, "I've shown you mine, now you show me yours".

Noble Lords: Oh!

Lord McIntosh of Haringey: My Lords, I have already said that such a list is available. As for the entirely bogus figure of £100 billion, which the noble Baroness and the Opposition keep on reviving, tell us what is in it.

Lord Saatchi: My Lords, familiar as he is with Section 6 of the Companies Act 1985, the Minister will know that that is the section which places an obligation on companies to obtain, before they publish their accounts, the approval of an independent auditor to the effect that the accounts give a true and fair view of the affairs of the company. Therefore, is it not a source of concern that when the Chancellor rises to give his Budget statement next week, he will not have obtained the approval of the Government's auditor for the figures that he will publish that day? In fact, is not the opposite the case? Has not the Government's auditor indicated his disapproval of the Government's method of presenting precisely these PFI and PPP liabilities to which my noble friend Lady Wilcox refers because they do not give a true and fair view of the Government's true liabilities?

Lord McIntosh of Haringey: My Lords, there are two points here. The first is the quite extraordinary suggestion that the Chancellor, in between completing his Budget calculations and making his Budget speech, should go to the National Audit Office for approval of all his figures. I think that Conservative Chancellors—I am sorry that there are no former Conservative Chancellors present—would raise at least one eyebrow at that suggestion.
	The second suggestion is that the National Audit Office has indicated its disapproval of the way in which the PFI figures are presented. That is certainly not the case. If the noble Lord is referring to the issue of on-balance sheet or off-balance sheet, that is not a matter for government decision—it is between the National Audit Office and the Office for National Statistics. They have jointly expressed the view that these matters are properly presented in government statements.

Lord Oakeshott of Seagrove Bay: My Lords, can we turn now to the real effect of the PFI on real people in the real world? Has the Minister seen the account today in The Times and other newspapers that WS Atkins, the troubled support services group, is pulling out of a contract to run Southwark schools two years into a five-year contract? WS Atkins says:
	"We are no longer prepared to carry on with a contract unless the margins hit our expectations".
	In other words, heads we win, tails we walk away.
	WS Atkins has seven PPP and PFI contracts in education, and it is about to take a big bite out of the Tube PPP through the Metronet consortium. When will the Government wake up to the risks of handing failing public services over to failing private sector contractors?

Lord McIntosh of Haringey: I cannot really believe that the noble Lord, Lord Oakeshott, is suggesting that somehow the Government, presumably through direct labour organisations, should carry out all construction and maintenance work in the public sector. The alternative is that private firms should do it. The noble Lord is now suggesting that those private firms should never be at any risk of financial failure. That cannot be the case—of course there are risks. The shareholders of WS Atkins take those risks. That is the point of private finance initiatives—that is the point of risk transfer.

Lord Oakeshott of Seagrove Bay: My Lords, that is exactly the point: the Government are taking those risks—

Noble Lords: Order!

Lord Glenarthur: My Lords, the Minister disputed the figure of £100 billion to which my noble friend Lady Wilcox referred. If he disputes that, will he give us the correct figure?

Lord McIntosh of Haringey: My Lords, it is not my figure. It is a figure dreamed up by the Opposition, and they have never succeeded in explaining it. I do not know what it comprises; I cannot believe in it until I see the evidence.

Lord Glenarthur: My Lords, the noble Lord asks for a figure—

Noble Lords: Oh!

Lord Williams of Mostyn: My Lords, we must have a degree of civilised order.

Earl Russell: My Lords, can the Minister explain to my noble friend Lord Oakeshott: when is a contract not a contract?

Lord McIntosh of Haringey: My Lords, a contract is a contract. It has contractual obligations.

Viscount Goschen: My Lords, can the Minister really derogate the Government's responsibility in the matter of the PFI and the PPP? Has not the National Audit Office expressed extreme concern about the off-balance sheet financing of Network Rail and has it not had a dispute with the national statistician about this? How can the Government sit back and say that it is nothing to do with them when it is a government-owned vehicle executing government policy?

Lord McIntosh of Haringey: My Lords, it is nothing to do with PFI. The classification of Network Rail is a classification of an organisation and not of an asset. The Office for National Statistics and the National Audit Office have agreed that, according to the way in which the ONS must classify Network Rail as per European accounting standards, it has been handled correctly.

Countryside Agency Report

Baroness Miller of Chilthorne Domer: asked Her Majesty's Government:
	What action they intend to take as a result of the report from the Countryside Agency State of the Countryside 2020.

Lord Whitty: My Lords, the Countryside Agency report, by painting pictures of alternative future scenarios, makes a very useful contribution to the debate on how we should reconcile, in a sustainable way, the conflicting pressures in our countryside. The Government are already actively working both to achieve real improvements to the quality of life in rural areas and to make the countryside itself attractive and enjoyable.

Baroness Miller of Chilthorne Domer: My Lords, the fact is that the pictures painted by the Countryside Agency's report depend largely on whether the Government will have more success in implementing their urban regeneration programme than they have had to date. Does the Minister agree that that programme is sadly behind schedule and the report of the noble Lord, Lord Rodgers, has not been implemented, which is why the knock-on effect on the countryside that the Countryside Agency has identified is likely to be so severe by 2020?

Lord Whitty: My Lords, the noble Baroness, uncharacteristically, completely misunderstands this report. The Countryside Agency is setting a number of possible scenarios such as whether there is greater or less success if the Government do nothing or if they complete and enhance their policies. There is obviously a relationship between what is going on in the towns and in the countryside, but it is not a direct relationship in terms of urban regeneration as against rural regeneration. The Government have programmes for both. They have been very successful in delivering both in many respects. Of course, some programmes are behind and some are more successful than we originally estimated. The general picture of the countryside in the report is of a very green and pleasant land.

Lord Monro of Langholm: My Lords, I declare an interest. Does the Minister agree that the paragraph on farming on page 18 is so depressing that he might have written it himself? Does he further agree that unless we look after farming we will not have the beautiful countryside, the landscape or the habitat that the whole nation wants? At the moment, the Government are going in quite the wrong direction, particularly through their alleged reform of the CAP.

Lord Whitty: My Lords, clearly farming is a major factor in the economy of the countryside and the way the landscape looks. It is therefore very important that we have a sustainable farming sector. But if the noble Lord is suggesting that in order to get a sustainable farming sector we keep the common agricultural policy in its present form, which is effectively subsidising production that does not have a market, greatly distorting the way in which farming operates and preventing it from becoming a commercial success, that is the wrong way to go. The right way to go is, as Commissioner Fischler suggests and the British Government support, the reform of the CAP.

Earl Peel: My Lords, leading on from my noble friend's question, and given the widespread dissatisfaction in the countryside about how the Government are fighting the cause of British agriculture, I ask the Minister two specific questions. What assurance can he give the House that his department will begin to take action against preventing the imports of food from abroad that are produced at standards which are below those produced by our farmers in this country? Secondly, what assurance can he give the House that he will seek derogations when EU directives work directly against the benefit of farmers, thus ensuring that by the year 2020 we still have a farming industry in this country?

Lord Whitty: My Lords, we shall have a successful farming industry in this country, and one with a good environmental outcome, if we pursue together the need for farming to respect the environment while at the same time becoming more commercial and more market oriented. That is the lesson of the Curry report, and that is very much the way in which the CAP reform proposals are going. As regards imports, clearly there are EU standards relating to those countries from which we take imports, particularly in relation to meat products. However, the noble Earl appeared to suggest that we would somehow roll back our commitment—and the commitment which we intend to pursue in the WTO negotiations—to a more liberal system of trading of food. I do not think that that is the right way to proceed.

Earl Russell: My Lords, does the Minister share my regret that the Government, while they have found it so easy to make copies of the Countryside Agency report available to the press, nevertheless cannot make it available to the PPO until tomorrow? Will he therefore forgive me if I ask for information which may be plainly available in the report? We hear from time to time of country dwellers on means-tested benefits who spend 10 per cent of their benefit on fares to travel to collect their benefit. Is the Minister aware of any research which quantifies that phenomenon? If he is not, will he attempt to persuade his colleagues in the Department for Work and Pensions to commission such research?

Lord Whitty: My Lords, I am not aware of such research. It certainly is not covered in the Countryside Agency report. If that report has not yet reached the PPO, I apologise to noble Lords. It certainly should have done.
	It is certainly true that, although the general picture of the countryside is one of substantial prosperity, the picture for some people in the countryside dependent on means-tested benefits and distant from transport and public services is not a good one and needs to be addressed. All government departments need to ensure that their policies take into account that rural dimension.

Lord Carter: My Lords, farming is suffering severe economic problems, but will my noble friend confirm that British agriculture receives more direct subsidy from the Treasury than the rest of British industry put together?

Lord Whitty: My Lords, my noble friend is, of course, correct. That subsidy results from the CAP. The problem, as I enunciated in my reply to the noble Lord, Lord Monro, is that that is the wrong kind of subsidy and support. We want to support British farming. We want to support European farming. However, the way the CAP currently does that goes entirely in the wrong direction.

Baroness Byford: My Lords, as many noble Lords obviously have not had the opportunity to look at this report, perhaps I may say that I too am very disappointed by it. It highlights the problems but it does not address any of the solutions. So I ask the Minister two questions. Accepting that obviously much depends on CAP reform, does he accept that the proposals mean that UK farmers will actually be at a disadvantage compared with other members of the EU because on the whole we have larger farms? Does he also accept that the report does not offer any solutions for many who live in the countryside? Indeed, the comments in that regard of the noble Earl, Lord Russell, were quite correct. It is all very well for the middle classes who have their own transport and housing they can afford, but for those who do not fall within those particular groups the report does not offer any solutions.

Lord Whitty: My Lords, on the latter question there are a number of government and Housing Corporation programmes relating to affordable housing which go some way to meeting the problems mentioned. Certainly, it is true that in many cases to be poor in rural areas is worse in relative terms than to be poor in parts of our cities. That is a problem which needs to be addressed. As regards the common agricultural policy reforms and UK farmers, although in general I support the direction in which Commissioner Fischler is going, there is one element—the formula on modulation—with which the noble Baroness is familiar, which would disadvantage British farmers if it remains in the form in which it is currently proposed. The British Government therefore seek radical changes to that part of the package.

Iraq: Media Frontline Coverage

Lord Glentoran: asked Her Majesty's Government:
	How many media passes to cover the war in Iraq they have allocated.

Lord Bach: My Lords, over 2,300 journalists have been registered and provided with media passes by the coalition in theatre. Of these, some 133 print and broadcast journalists are officially accredited war correspondents embedded with British forces.

Lord Glentoran: My Lords, I thank the noble Lord for that precise Answer. Do Her Majesty's Government think that having such a large number of journalists and reporters embedded in the front line is a sensible and responsible way of covering what is a major war conflict?

Lord Bach: My Lords, British forces have a long established tradition of allowing correspondents to accompany them on operations going back to the Crimean War and right up through all modern wars, including the Falklands War and the Gulf War. Embedding journalists may well inhibit those journalists' freedom of movement but it allows our Armed Forces to help ensure their safety. We live in a free society with a free press. When the press report what we like, we never complain about it. When the press report what we do not like, that is when we must come to its defence.

Lord Molyneaux of Killead: My Lords, what action will be taken following this morning's BBC disclosure of what it described as a confidential document restricted to senior officers only?

Lord Bach: My Lords, I am afraid that I am not aware of the matter that the noble Lord mentions. I hope very much that the BBC will behave responsibly on this aspect as on all others.

Lord Taylor of Blackburn: My Lords, is my noble friend aware that some of us appreciate that the Government are more or less obliged to allow journalists and media personnel to be present in war zones and that they have been present during many wars since the Crimean War? However, these days modern technology makes it appear as if they are reporting events before they have even happened. Many of us are very disturbed by that.

Lord Bach: My Lords, the view that my noble friend expresses is felt not just inside this House but also outside it. However, I am afraid we have to accept that the 24-hour media is a reality with which we must live. One of the dangers of embedded journalism can be that it tends to provide snapshots of the action which, taken together, can produce—I choose my words carefully—a less than complete picture of the wider position. It is important that we do not lose sight of the wider campaign objectives.

Lord McNally: My Lords, does the Minister agree that one of the differences between democracies and totalitarian states at times of war is that in democracies there continues an informed national debate about that war and that for that informed national debate we depend upon the courage of war correspondents? Does the Minister accept that we on these Benches endorse what he says about a free media? Does he further accept that the longer we prevent government interference in the BBC and the other media, the better our people will understand what is happening in Iraq and the better the likely outcome?

Lord Bach: My Lords, I accept the basis of what the noble Lord says about a free press. I also accept what he says about the bravery of correspondents, embedded or otherwise. I pay tribute—as have many since yesterday—to the distinguished BBC cameraman, Kaveh Golestan, who died tragically yesterday. Along with that freedom, of course, goes responsibility. It is getting that balance right that many in this House are concerned about.

Lord Howell of Guildford: My Lords, would we not be seeing a rather different picture of the campaign if a few journalists were embedded in the Iraqi frontline forces?
	The journalists embedded in the frontline are very brave people. However, is not their difficulty that they are inclined—in particular if they are inexperienced—to report every shot as heavy fighting, every wound as massive casualties and every pause as the Army being bogged down? Although we must leave the press entirely free to report events, could we not encourage more of the sense of balance that the Minister has just described? If journalists were covering matters a little less close to the immediate front line and giving more perspective to the broader scene, the result would be totally different from the impression we have been receiving.

Lord Bach: My Lords, at present I am afraid that I have no information as regards what Iraqi journalists embedded in their frontline are reporting. When I do hear something, I shall tell the noble Lord first. The point he asks about is one that I hope I have already made to some extent. We think there is a danger that embedded journalists are trying to provide what are called "snapshots" of the action too soon. That can, and perhaps has, led from time to time over the past couple of weeks to a false idea being given of how the campaign is going.

Lord Williams of Mostyn: My Lords, we have reached the end of Question Time.

Iraq: Military Operations

Lord Bach: My Lords, with the leave of the House, I shall now repeat a Statement made earlier today in another place by my right honourable friend the Secretary of State for Defence. The Statement is as follows:
	"I would like to make a further Statement about military action in Iraq. We are now two weeks into the campaign. The coalition continues to make remarkable progress, following the main outlines of our military plan.
	"Since my last Statement on 26th March, coalition forces have been establishing a presence in northern Iraq and moving ever closer to Baghdad. Another important phase has been reached as the first troops engage Saddam's Republican Guard divisions on the approaches to the city. At the same time, British forces are consolidating their position in the area in and around Basra.
	"I want to repeat the warning I made in my first Statement to this House some two weeks ago. Do not underestimate the task that still faces our forces, or the length of time that it may take to complete. We are still very much in the second phase of the steady progress that my right honourable friend the Prime Minister has set out.
	"On behalf of the Government, I want to extend our condolences to the families and friends of those servicemen who have lost their lives in recent days. I would like to mention as well those who have been injured, some seriously, since the start of military operations, either in combat or through the usual course of their duties. Thirty-nine UK battle casualties are currently being treated in theatre and 35 have been evacuated. I know that the House will join me in sending our very best wishes for their speedy recovery.
	"In this conflict, we have been accused by commentators of underestimating the resistance of the Iraqi regime. We always knew that the regime would fight—but what has shocked us, as democratic states observing the rule of law, is the extent of the Iraqi regime's capacity for brutality and the killing of its own people. Every aspect of what we do is rightly and understandably held up for public scrutiny. In contrast, Saddam Hussein's murderous thugs go about their brutal work out of sight of the media.
	"There are those who have been surprised by the caution with which the Iraqi people have greeted coalition forces. But that should not be surprising. This is a regime that has deployed every horror in maintaining its stranglehold on power—torture, rape and execution. In recent days, our forces on the ground around Basra have been appalled by the actions of the regime's thugs as they struggle to maintain their grip on the city.
	"On 25th March, there were disturbances in Basra which irregular regime forces suppressed with mortar fire against their own people. On 28th March, when between 1,000 and 2,000 people were preparing to leave Basra, regime militia opened fire with heavy machine gun and mortar fire. Since then irregulars have been routinely firing on civilians in the south-east of Basra. This is the kind of brutal suppression that has been going on inside Iraq for very many years.
	"Despite its protestations to the contrary, the Iraqi regime shows no greater respect for the country's cultural wealth than it does for its people. The coalition is taking every precaution to avoid damage to the holy sites in An Najaf and Karbala. By contrast, we know that Saddam Hussein has plans to damage these sites and to blame the coalition. Indeed, his forces have used the site at An Najaf as a defensive position, firing on US forces, who commendably did not return fire.
	"The steady advance of the coalition continues. Our strategic grip on Iraq is tightening. In the south, British forces continue to operate in the Al Faw peninsula, the southern oilfields and the Basra area. 7th Armoured Brigade is preventing Iraqi forces in Basra from hindering the main advance, while establishing corridors for the safe movement of civilians and humanitarian aid.
	"We have been striking key regime targets in the area. These operations have included successful attacks from the air on the Ba'ath Party headquarters in Basra, and by 7th Armoured Brigade on the intelligence and militia headquarters in Basra and the local state security organisation headquarters in Al Zubayr, to the south of Basra.
	"3 Commando Brigade Royal Marines engaged substantial Iraqi forces in the area of Abu Al Khasib in the south-east outskirts of Basra, capturing significant numbers of enemy forces, including senior Iraqi officers. This daring raid resulted in the death of one Royal Marine. There were in addition a number of casualties.
	"On the night of 31st March, 16 Air Assault Brigade, with artillery and air support, engaged Iraqi forces, destroying an estimated 17 tanks and five artillery pieces, as well as other Iraqi vehicles and infantry positions.
	"We are now focused on building the confidence of the local people. We will continue to patrol aggressively, striking hard at the regime and its militias. Key suburbs of Basra have now been taken. We will go further into the city at a time of our own choosing.
	"Further north, elements of the United States' Army's Fifth Corps have now passed through Karbala and are moving towards Baghdad. US forces have been engaging with the Medina and Baghdad Republican Guard divisions, and have secured crossings over the Tigris and Euphrates rivers. The lead elements of the US 3rd Infantry Division are now on the outskirts of Baghdad. Over 9,000 Iraqi prisoners of war have been taken by coalition forces.
	"Royal Air Force aircraft have contributed to the close air support of these forces. They have also attacked Iraqi forces in the field, and have continued to degrade the regime's command and control facilities, and the combat capability of the security forces which support it.
	"Coalition forces have taken the utmost care over the targeting of the air campaign. Every effort has been made to minimise the risk of any civilian casualties or damage to the civilian infrastructure. The House will be aware of the explosions in market districts of Baghdad on 26th and 28th March, and reports of significant numbers of fatalities and injuries. Neither of the marketplaces were targeted by the coalition and we continue to investigate how those tragic events might have occurred. We have long been familiar with the false claims of civilian casualties made by Saddam's regime, and it would be foolish to accept these claims at face value without proper investigation. What we do know is that the air defence commander in Baghdad has been replaced, partly because of his concerns that Iraqi surface-to-air missiles had been malfunctioning, failing to hit their targets and falling back on Baghdad.
	"Offensive operations are, however, only one part of the picture. The expertise and flexibility of our forces are essential to the battle to win the confidence of the Iraqi people. The Iraqi people have been terrified. Over half the population of Iraq has only known life under Saddam Hussein and his apparatus of fear. The older generation has an appreciation of his cruelty that is borne out by bitter personal experience. That is why it is so important that in a number of areas where UK forces are operating, there is a growing sense of return to normal life. Some people are going back to work. The United Nations has now declared Umm Qasr a 'permissive environment'—allowing UN agencies to begin their work there.
	"Essential services such as water and electricity are being restored and even improved, due in part to the skill of the Royal Engineers and the International Committee of the Red Cross. The Umm Qasr water treatment plant, which can treat up to 3 million litres a day, is now operational. In addition, the water pipeline constructed by UK forces from Kuwait to Umm Qasr is complete, delivering up to 2 million litres of drinking water daily—enough for 160,000 people per day—and providing vital temporary relief.
	"Schools and markets are being re-opened. 7th Armoured Brigade has removed Ba'ath Party thugs from the Al Zubayr medical centre—where treatment was previously available only to those close to the regime—to enable access for ordinary Iraqis. Humanitarian aid is being distributed. The security situation in a growing number of areas is such that troops are patrolling on foot rather than in armoured cars, and have in some cases been able to exchange their combat helmets for berets. The UK Armed Forces are putting the full range of their expertise and experience to use, with striking effect.
	"The Royal Marines have disabled the last remnants of the Iraqi navy, and the port of Umm Qasr is under coalition control and being opened to shipping. Royal Navy mine countermeasures vessels continue operations to expand the navigable width of the Khawr Abd' Allah channel. They have discovered 105 mines so far—11 laid in the water, and a total of 94 intercepted on Iraqi tugs and patrol boats.
	"Those operations are crucial to the humanitarian operation, bringing vital supplies to the Iraqi people. On 28th March the Royal Fleet Auxiliary vessel 'Sir Galahad' unloaded its humanitarian cargo of around 300 tonnes of water, medical supplies, food and equipment for providing shelter. Water and perishable goods have already been distributed in the Umm Qasr area; other supplies are being stored until such time as they are required. Two Australian ships, each loaded with some 50,000 tonnes of grain, are expected in Umm Qasr shortly.
	"The UN Oil for Food programme was re-established by Security Council Resolution 1472 on 28th March, an important milestone for the people of Iraq. But it will take time to take effect. 1 (UK) Division therefore has authority to spend up to £30 million for special humanitarian purposes within the first month, and a further £10 million is available for 'quick impact' projects, such as restoring electricity and water supplies.
	"After two weeks of military operations against the Iraqi regime, the coalition continues to make progress. Every day we are further weakening Saddam Hussein's control over Iraq, and moving another day closer to the end of his appalling regime and the liberation of the Iraqi people.
	"We are engaged in an important and determined effort to convince the Iraqi people of our commitment to them—to their political security and their economic welfare. Above all, we must convince them of our commitment to see through what we have begun—to remove the regime that has terrified the Iraqi people and impoverished their nation for two decades. It will take time.
	"We have made an excellent start, but there is still much more to achieve. Our servicemen and women will continue to brave difficulties and dangers in the process. I know that the House will join me in wishing them well".
	My Lords, that concludes the Statement.

Lord Howell of Guildford: My Lords, the House will be extremely grateful to the noble Lord for repeating that very detailed and helpful Statement, which updated us and clarified matters on the campaign. Will he accept that we on these Benches totally associate ourselves with his remarks about the skill and courage of our troops? We look with pride at the way in which our soldiers and Armed Forces are conducting this very skilled and sensitive operation with such good humour, determination and willingness.
	Of course, there have been casualties—admittedly few, but each is a tragedy. We therefore also echo the noble Lord's words of condolence and deepest sympathy. Above all, our hearts go out to those who are widowed and the parents of sons or daughters who will not be coming back. I also add a word of praise for the special forces. They are conducting incredibly dangerous operations, unseen and often unpraised. Nevertheless, they are offering their lives for the crucial purpose.
	The Statement confirms what amazing progress has been made in the 13 days so far of the campaign. I believe that the first Gulf War lasted 43 days, and someone reminded me that even the German blitzkrieg of 1940 on Paris—the most famous and fastest Panzer advance of all time—took 44 days. Here we are after 13 days, 15 miles from Baghdad, with south and west Iraq more or less secured except for certain areas. That is frankly an amazing achievement.
	The oil fields around Ramallah, or most of them, have been secured without destruction. Best of all, as the Minister indicated, there has been growing co-operation and I believe intelligence—it will be vital as we get into Baghdad—from Iraqi citizens. Are not the great pundits who advise us so freely and fully nearly always wrong? Many of them said that everything would be over in a week, and they were wrong about that. Now they have swung to the other extreme and are saying that we will have months of siege round Baghdad, but I suspect that they will be wrong about that too.
	The only very mild point of disagreement that I have with the Statement is in the expression of shock about the brutality. Surely it is obvious that the Ba'ath Party is a Nazi-modelled regime, designed on Nazi lines with Nazi ideology by Michael Aflaq. There really should be no surprise at all that its members are behaving like Nazi fanatics—surrendering and then shooting, executing and strangling their own people to the last, ruling by ghastly torture and terror as the Minister mentioned, disguising as civilians, desecrating their own holy sites, and using every other device of people who have no future at all outside the regime and the party. If any of them survives, their future when Iraq settles down will be very terrible indeed.
	What the Minister says about the post-conflict situation is encouraging. It must be obvious that everyone's aim is to return Iraq to the Iraqi people as soon as possible. Whether the transition is run by the coalition military, a United Nations authority or, as I suspect will be necessary, both, is not the aim to do everything possible to get Iraq—an ancient and proud nation—on its feet again as a wealthy and civilised country for the future? Meanwhile, will not the coalition military forces obviously be needed everywhere to safeguard the humanitarian workers and the skilled UN agency staff, whom I know long to get in but cannot do so as long as there is a danger of being shot at or attacked by pockets of resistance?
	Is the Minister aware that we welcome the Government's adoption of the scheme proposed by my colleague Iain Duncan Smith for an early conference of political groupings to work out the next stage in Iraq's political development? If possible, that should be held on Iraqi soil. Without any complacency that the battle is over—it obviously is not—we should look further ahead from there and plan to help with social and educational reform. It is even proposed, and I think rightly, that we think about welcoming back Iraqi students into our own universities. There used to be a great many, and we should bring them back and enable them to see how the benefits of a freer and, one hopes, a democratic society work.
	Although there are clearly many dangers ahead, and Arab passions may well be enflamed a bit further—they were enflamed before anyway—can we keep in mind the attainable vision of a benign and prosperous Iraq? Instead of pumping poison into the surrounding region, as it has done for the past 12 years, it should start to radiate peace and prosperity throughout the Arab world. It could do so, as it is basically a very wealthy and powerful nation. There may be many risks in what is happening in this campaign, but there are also many possibilities, and I suggest that we think a little more about those.

Lord Wallace of Saltaire: My Lords, I also thank the Minister for the Statement. I am conscious that in the middle of a war there is one thing worse than armchair generals, which is armchair politicians, so I do not intend to comment on the details of the Statement or what is happening on the ground.
	As noble Lords will recall, our party was not convinced of the case for war starting when it did. Now that it is under way, it is important that it is conducted successfully, quickly, according to the laws of war, and with proportionate and appropriate force. We are most impressed by the behaviour of British troops, particularly by what we have seen of the Black Watch and the Marines in the outskirts of Basra, in terms of the extent to which they have used the bitter experience that British forces have gained over 30 years in Northern Ireland. They have put that to good use in beginning to rebuild the confidence of the people of what is now occupied Iraq. We are also impressed by the restraint of American troops in respect of the extremely delicate issue of the holy places. We regret the number of British casualties and we understand the bitterness of the relations of those killed in accidents as well as in combat. We send our sympathies to those who have suffered.
	I want to ask about the important issue of the conduct of the war. The Minister mentioned prisoners of war. It is important that prisoners of war are treated entirely appropriately, according to the laws of war and the Geneva Convention. A number of prisoners of war are being taken who are not currently wearing uniform and whose status is ambiguous. Questions have been raised in the British press and there have been reports that some of them may be handed over to the United States. Will the Minister assure us that prisoners of war who are taken by the British will remain under British control? If not, what justification is there for handing them over to the control of our allies?
	We also ask about reports that air-launched cluster bombs have been used. A large number of questions have been raised about them. There is a 5 per cent failure rate which means that many unexploded bomblets are left in an area, even if British troops have given a commitment to clean them up afterwards. Two British soldiers were killed in Kosovo in the process of clearing up cluster bombs that had been used there. There are highly likely to be civilian casualities before the clear-up operation has taken place. Those weapons are to be used only under the most extreme circumstances against massive concentrations of Iraqi troops. I was not aware that we had yet met massive concentrations of Iraqi troops.
	I turn to the whole question of weapons of mass destruction, which was, after all, the rationale for going to war. I read in an e-mail this morning a quotation from a senior American official who said that the most disastrous outcome of the war would be if we do not find any weapons of mass destruction. I fear that if it is only the Americans who find evidence of weapons of mass destruction a substantial proportion of the world—certainly of the Muslim world—will not be entirely convinced. Does the Minister accept that getting independent inspectors—preferably UN inspectors—alongside coalition forces to verify if and when weapons of mass destruction are found will enhance the credibility of what we are doing?
	Winning the peace is clearly the most important element. We are happy to see the way in which British forces are already concerning themselves with that even while the war continues in terms of humanitarian assistance and nation-building. That will involve some co-operation with some people who have been serving the current regime because that is the way in which one has to operate when rebuilding an administration in what used to be called assistance to the civilian plan. That involves the whole question of the re-establishment of domestic order and self-government. As that operation proceeds with the restoration of local authority and some form of local administration in UK areas, will it be subject to US suzerainty or will it primarily be a British responsibility?
	We welcome ideas which I know that the Foreign Secretary has been floating for consultation with other states in the region. If a peaceful Iraq is to be established in a peaceful region, the greater will be the confidence of Iraq's neighbours in what will be established. The greater the sense that they share the outcome, the better. Those are broader issues for post-war governance of Iraq and they go rather further than the terms of the defence Statement in the middle of the war.

Lord Bach: My Lords, I thank both noble Lords very much indeed for their support, which will be much appreciated by British troops and their families in this country.
	I am particularly grateful to the noble Lord, Lord Howell, for his points about the progress during the past fortnight. He also discussed the need to ensure that Iraqis became free and lived in a benign and prosperous state. I agree with every point that he made. He sought to disagree with us on one small aspect, which was, of course, our naivety in being shocked by the enormities of the Iraqi regime. I believe that he meant that chiding fairly gently. My goodness, we live in a society that has its own problems, unnecessary violence and difficulties. However, when compared with the Iraqi regime, we are for the most part perhaps too used to living a comfortable, ordinary life. It is still shocking to hear the tales that troops tell about what has happened to those in, for example, Basra who dared to rise up against the tyranny that has oppressed them for so long. I thank him very much for his comments.
	The noble Lord, Lord Wallace of Saltaire, was equally supportive and I am grateful to him, too, for his comments. He asked specific questions about some fairly broad subjects. He will forgive me if I do not go into huge detail on any of them. I know that some time early next week we will be able to discuss in this House, if only briefly, the question of prisoners of war.
	The coalition currently holds about 7,600 confirmed prisoners of war, of which the British forces hold 4,100. All those captured by British forces are being treated strictly in accordance with our obligations under the Geneva Conventions and international law, as he would expect. Some prisoners of war currently being held by British forces are in fact United States detainees and they will continue to be held until United States facilities are of a standard that the custody can be transferred. The numbers that we hold may drop in the next couple of weeks. Responsibility for the treatment of prisoners of war rests with the detaining power but the Geneva Conventions allow for transfer to the custody of another party. However, we will retain responsibility for their treatment. Captured Iraqis will be given prisoner of war status until proved otherwise and will be treated, as I said, according to the obligations that we know so well.
	It is important to point out that cluster bombs are not in any sense illegal; they are allowed and serve a useful military purpose, which has nothing to do with civilians or confined areas. It has plenty to do with areas in which there are enemy vehicles spread out over an area where it is necessary to ensure that those vehicles cannot be used against us and that they are destroyed. We have used cluster bombs against legitimate military targets such as Iraqi armoured units in a manner—I emphasise this—that is consistent with our obligations under international law.
	On weapons of mass destruction, we await to see what is found around the Baghdad area in particular. It is interesting that on 29th March United States marines discovered chemical suits, masks and nerve gas antidote in buildings in Nasiriyah that were clearly used by members of Iraq's 11th Infantry Division. I have actually been asked on the media whether that means that those soldiers were expecting a chemical/biological attack from coalition forces. Just to ask that question shows its absurdity. The United States and Britain are signed up to every convention forbidding our use of such weapons. Iraq, it goes without saying, is not. Those chemical suits, masks and nerve gas were to protect the Iraqi troops from their own government's actions.
	Both noble Lords spoke movingly about casualties. Thankfully, as of now, they are not as high as might have occurred in previous wars; however, I say "as of now" because we never know what may occur. The bravery of those men who have died is well known to all of us. Reading today's newspapers, I thought that the mother of a member of the Armed Forces who died in that first terrible accident between Sea Kings spoke in an ordinary voice for all of us when she said,
	"He was not just his mother's son, he was the country's son".

Lord Elton: My Lords, first, I endorse everything said by my noble friend on this Front Bench and in particular pay tribute to the gallantry of our troops. Secondly, can the Minister comment on a report published yesterday which states that there has now been a refinement of cluster bombs enabling similar ordnance to be fired from howitzers? We are all agreed that the future peace and stability of Iraq is of the first importance politically and from a humanitarian point of view.
	We are all aware of the public statement that up to 5 per cent of the bomblets in cluster with ordnance do not explode on impact. Can the Minister assure the House, therefore, that proper procedures are established at battery headquarters and at the forward observation post when this ordnance is used to record both the intended target and the actual fall of shot so that in the follow-up we can clear the ordnance from the ground and avoid the prospect of seeing one-legged children as witnessed in the wake of other campaigns where that sort of weapon has been used?

Lord Bach: My Lords, I cannot comment on the report mentioned by the noble Lord because I have not seen it, but I think I can give the assurance he seeks. Every time this particular weapon is used a very close record is kept of what it was that delivered the weapon and where it was so that every effort can be made to ensure that there are no accidents afterwards. War is a terrible thing and casualties occur in the worst possible situations. I cannot give the noble Lord a guarantee that it will never happen, but great care is taken by coalition forces when using that weapon and every other weapon.

The Lord Bishop of Oxford: My Lords, in thanking the Government for their helpful Statement, from these Benches we also express sympathy for those families who are grieving or who are concerned about members who are severely wounded. We express appreciation too for the very great care which British forces are taking.
	Can the Minister say more about the post-military conflict government in Iraq? There is continuing worry about what form that government will take. As the noble Lord, Lord Howell, said, the purpose is to give Iraq back to the Iraqis. That cannot be said frequently enough or loudly enough but I think that the message has not yet really got through. There is still great concern that the kind of government which comes about in the end might simply be the imposition of a western-style democracy, which is not natural to many countries. Iraq is a predominantly Islamic country. Would it be possible to bring into the councils of those who are planning a post-conflict settlement Islamic thinkers who are working towards an Islamic understanding of democracy and who are prepared to argue for a western-style democracy but using Islamic concepts and Islamic themes? It seems to me that whatever form of government comes about in Iraq, it must have the confidence of the Iraqi people. That means that it must have the confidence of the best Islamic thinkers in this area.

Lord Bach: My Lords, I am grateful to the right reverend Prelate for his comments. We do not disagree with anything he says. He will know that international discussions have taken place over a very long period of time, dating from well before the conflict began, about the form of any administration in post-conflict Iraq. Those discussions continue at the United Nations and between nations generally now. The rule we set ourselves is that we want to see the Iraqis ruled by the Iraqis. That is what matters. It fits in, I believe, with what the right reverend Prelate suggests. In the end, the exact form of government and democracy which emerges will be a matter for the Iraqi people to decide. I am sure it may very well be that his suggestion in relation to experts and holy men in Islam who may be able to advise will be taken on board. We want to see a phased transfer of authority leading to a new representative Iraqi government as soon as possible. The vital words are "as soon as possible". Let us make no mistake. When the conflict is over there will be a security issue that will last for some little time.

Lord Campbell-Savours: My Lords, is there not some merit in the case put by the Leader of the Opposition for a further conference in Iraq of representatives of the opposition following the one which took place in Salumaniya some five weeks ago? Instead of holding the next conference in Kurdistan, would it not be wise to hold it in what one hopes will be a liberated Basra in a couple of weeks? That would send precisely the right kind of signals to the rest of Iraq.

Lord Bach: My Lords, I am grateful to my noble friend. The right honourable gentleman the Leader of the Opposition has put forward a very interesting idea; we are considering it with care. We have also to consider the security aspects. One thing is certain. Day by day we are getting closer to our objective, which is the freedom of the Iraqi people to decide their own future. The United Kingdom's vision for Iraq and the Iraqi people underlines our commitment to the restoration of a free Iraq, free from UN sanctions and from the tyranny we have discussed today. Certainly, we shall not let the Iraqi people down.

Lord Avebury: My Lords, following the proposal by the right reverend Prelate and the emphasis in the Statement on the care taken by our forces not to cause any damage to the holy places of Najaf and Karbala, will the Government consider having some embedded Shia imams travelling with our forces to verify the care taken in the holy places and the concern that we have for the local Shia population to demonstrate the commitment which the noble Lord mentioned in the Statement?

Lord Bach: My Lords, certainly we take on board the very interesting idea suggested by the noble Lord. However, we should not be in any doubt about the hypocrisy of the Iraqi regime in relation to holy sites. In 1991 Iraqi troops attacked and desecrated the shrine of Imam Ali and destroyed religious libraries in Najaf. They went further and shelled and desecrated Imam Hussein's shrine in Karbala. The shrine of Imam Abbas was also reported damaged. Indeed, it is believed that acts of murder, torture and rape were committed in religious buildings. It is important to make clear that we need to look to the Iraqi regime to behave itself, not to coalition troops.

Lord Campbell of Alloway: My Lords, without any derogation from anything said by the right reverend Prelate the Bishop of Oxford, with which I totally agree, I want to ask the Minister something more immediate. It is a question of prisoners of war, in which I declare an interest, and must do so, as president of the Colditz Association.
	I do not want to make a long speech, but I have one or two queries and I want to ask a question. Are we agreed with our American allies as to the treatment of those who dress up as women who are not regular combatants and who are not generally recognised as having the protection of prisoners of war under the convention? What is the position of what used to be called the SOE agents in France? How are they to be treated? Perhaps they are now the SAS. Such matters require consideration. I raised them with the noble and learned Lord, Lord Williams of Mostyn, some time ago. He said that those matters would be monitored. No doubt they have been. Will they be monitored now? Will some agreement be sought in this rather grey area.

Lord Bach: My Lords, I repeat what I said a few minutes ago that captured Iraqis will be given prisoner of war status until they are proved otherwise and they will be treated according to our obligations under the Geneva Conventions. Captured Iraqi forces are likely to be prisoners of war unless they conceal weapons in the conduct of operations, in which case, as the noble Lord will know, they are unlawful combatants. Although unlawful combatants do not have prisoner of war status, we would have a duty, under international humanitarian law, which we would fulfil, to treat prisoners in a reasonable and humane manner. I hope that that answers the noble Lord's question.

Lord Alton of Liverpool: My Lords, does the Minister agree that the courage and the conduct of our troops contrast not just with the cynicism of using holy places at Najaf and Karbala for purely cynical motives, but also with the cowardly way in which Saddam's militia have used civilians, including pregnant women and children, as human shields and with the way in which hospitals, including a maternity unit, have been used to house his military positions? Perhaps the Minister will return to a question that I put to him last week. What will we do about those who have been responsible for genocide and crimes against humanity during the previous 12 years and during the hostilities to bring them to justice and to account in due course? What mechanisms will be put in place to achieve that?

Lord Bach: My Lords, the noble Lord makes an excellent point. The contrasts between the coalition and the Iraqi regime are stark. He explains very well why they are so stark but they are stark in many other ways as well. The use of the Iraqi civilian population to hide Iraqi troops, including beaten troops, and in campaigns against the coalition is clear and there is much evidence of that. As regards those who may be guilty of the kind of crimes that he mentions, I repeat that we are absolutely determined, as are our other coalition partners, to bring such people to justice. We do not mean Iraqi soldiers who are forced at gun point to sacrifice their lives for the ridiculous tyranny; we mean those who are actually responsible for what is going on, the ones who hold the guns to their heads. We shall bring them to justice through the international system of justice that has now—thank goodness—been set up.

Lord Richard: My Lords, on the way in which the war has gone to date, it seems as though the British effort is being concentrated in the south and the American effort is being concentrated in the north. I do not know whether my noble friend can answer this question.

A noble Lord: My Lords, then why ask it?

Lord Richard: My Lords, I want to see whether he answers it, of course. What an extraordinary interruption! Do the Government intend that British troops should be used to any significant extent in the fighting for Baghdad? One hears much about the plan, which has had a fair amount of publicity. I hope that is a general question that does not go too far in the direction of disclosure, which my noble friend would not wish to do.

Lord Bach: My Lords, my noble friend asks an excellent question, but it is not one that I can answer—at any rate not today. I would point out that he is right to make a broad division between north and south. In part of the Statement that I read out, Royal Air Force aeroplanes have been very important in the advances that have been made in the middle and towards the north of Iraq. I do not think that we can say that the Brits are in the south and the Americans are in the centre and in the north. It is a coalition effort that is going pretty well.

Baroness Ludford: My Lords, can the Minister clarify the prisoner of war situation? He has been largely reassuring about the situation of British detainees, although he spoke of how they would be treated as prisoners of war under the Geneva Conventions until proved otherwise. Under what mechanism would it be decided that such prisoners were not prisoners of war but unlawful combatants? What would happen to people who are classified as unlawful combatants? I do not believe that he has clarified what he understands the situation to be, and what assurances he has received from the United States about the status of their detainees. There have been worrying press comments about whether they intend to treat all their detainees as prisoners of war. We are all concerned about the precedent of Guantanamo Bay, as people there have been in a legal limbo for over 15 months, including a number of British citizens, without apparent protest or action by the British Government. One would not want people to go into the same kind of legal limbo without due process of charge and trial or treatment as prisoners of war under the Geneva conventions. Can the Minister clarify what assurances there have been from the United States?

Lord Bach: My Lords, I cannot accept the premise of the noble Baroness that the situation at Guantanamo Bay is as she describes it. I understand that no one from Iraq is there at present, although I may be wrong about that. The US assure us—I have no reason to disbelieve them—that the detainees there are being treated humanely and in accordance with the principles of the Geneva Conventions—that is important. British officials have visited those prisoners on four occasions and found them to be in a "generally satisfactory condition". We are not prepared to accept that people held in Guantanamo Bay necessarily suffer lower standards than anywhere else.
	On the first question posed by the noble Baroness, if and when we decide that people are not prisoners of war in the strict sense—I have already answered the question—we shall deal with them under basic humanitarian law.

Lord Burnham: My Lords, in the Statement the Secretary of State referred to regret that we were not seeing anything from the Iraqi side. Am I alone in being concerned about the position of the BBC who has its correspondent in the middle of Baghdad? Are we receiving fair reports from that correspondent?

Lord Bach: My Lords, I am sure that the noble Lord is never alone in any opinion that he holds. I believe that his opinion may be shared around the House, although it is certainly not an opinion on which Her Majesty's Government can comment.

Lord Hardy of Wath: My Lords, can my noble friend say whether arrangements are in place to accommodate a huge increase in the number of people surrendering, which is possible and desirable? One would expect the number to be much larger than the number that he gave the House a little while ago.

Lord Bach: My Lords, all I can say is that we are ready for that eventuality. The British are particularly good at meeting such a situation. My noble friend may be right and we may meet that situation sooner rather than later.

Lord Eden of Winton: My Lords, is it praiseworthy that there is such effective co-ordination between British and American ground and air forces? As the war is now entering a particularly hazardous phase, can the noble Lord assure the House that sufficient strength is held in reserve to support our forces on the ground, in particular in the event that special forces on the Iraqi side are concealed in bunkers deeply underground?

Lord Bach: My Lords, I can give the noble Lord the reassurance that he seeks.

Baroness Walmsley: My Lords, perhaps I may ask two questions.

Lord Williams of Mostyn: My Lords, the time is up; and it is mandatory.

Police (Northern Ireland) Bill [HL]

Further proceedings on consideration of Commons amendments resumed.

COMMONS AMENDMENT

15 After Clause 15, insert the following new clause—
	"BELFAST
	(1) Schedule (Belfast) makes provision in relation to Belfast.
	(2) Subsection (1) comes into force in accordance with provision made by the Secretary of State by order."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 15.
	The new clause and schedule inserted by Amendments Nos. 15 and 52 relate to arrangements within Belfast for the sub-groups of the DPPs. If passed, they would replace the existing Section 21 of the 2000 Act and make a series of supplementary consequential amendments. As noble Lords will have noted, Amendment No. 56 is consequential upon Amendment No. 52. We have dealt with the issue of commencement. I hope that I have covered fully the matters covered by Amendment No. 15B in the names of the noble Lords, Lord Rogan, and Lord Maginnis.
	There is a police district for every district council area in Northern Ireland except Belfast. Belfast City Council's jurisdiction is split into four police districts: north, south, east and west. That reflects a Patten recommendation because of the generally larger size of the population and, therefore, the work of the police in Belfast. Each of the four police districts in Belfast covers a population very nearly the size of the next largest district outside Belfast.
	It is already a requirement under Section 21 of the 2000 Act for Belfast City Council to establish a sub-group of its DPP for each of the police districts within Belfast; that is, four. At present, the sub-groups' only function is to give views on any matter concerning the policing of that police district to the district commander and to the DPP itself. That is in contrast to the functions of a full DPP.
	We undertook to consider, in the context of a review of police, whether those limited powers remained appropriate. That is what we have done. We are persuaded that there is justification in the sub-groups for the four Belfast districts having extended functions covering most of the functions enjoyed by full DPPs. We propose, therefore, that the sub-groups should have functions mirroring those contained in Section 16(1)(a) to (d) of the Act. We think that that should help to strengthen local relationships.
	Patten specifically referred to these as being sub-groups or sub-committees. So, unlike full DPPs, the sub-groups will not be accountable to the Policing Board or the local council. That will remain, I stress, the role of the Belfast DPP itself. We have included, therefore, within this clause provisions requiring sub-groups to provide annual reports to the DPP which will enable it in turn to give its own annual report to Belfast City Council.
	The powers and duties of the Belfast DPP would change in three respects. First, it is given the power to require a sub-group to provide a report on any matter concerned with the exercise of its functions. This may be for the benefit of the DPP or to enable it to respond to a request from the board for a report covering the whole of Belfast.
	Secondly, the Belfast DPP is given slightly longer than other DPPs to submit its annual report to the council. That is to allow it sufficient time to have commissioned and received the relevant reports, as I indicated earlier.
	Thirdly, we wish to avoid unnecessary duplication. The DPP retains the ultimate responsibility for ensuring that the functions of consultation are adequately fulfilled. But if the DPP itself is satisfied that a function is already being adequately carried out by a sub-group, it is exempted from the obligation to duplicate that work in respect of that sub-group. This is a practical measure to prevent wasteful and unnecessary duplication and cost.
	Other than those flexibilities, the functions, powers and role of the Belfast DPP remain in line with those that apply to other DPPs. To ensure an effective link with the sub-groups, four of the political seats on the DPP will be held by the chairmen of the sub-groups. Those offices will be rotated between the four largest political parties on the council, so there will be a slight change in DPP membership each year.
	We have looked again at the regulation of sub-group procedures. At present, each sub-group has to,
	"consist of at least six members of the partnership".
	There is no maximum size; nor is there any specified balance between political and independent members; nor is there any arrangement for rotating chairmanship. We are aware, of course, that even with sub-groups of the minimum size, members of the DPP would have to sit on both it and at least one sub-group—and in some cases more than one. That is a significant workload for councillors who will have many other calls on their time.
	Since the sub-groups will take on additional functions, we believe that there will be benefit in increasing the size of the sub-groups and being more specific about membership arrangements. Paragraph 13 of the schedule inserted by Amendment No. 52 inserts a new Schedule 3A in the Act. This mirrors in almost every respect the provisions of Schedule 3 in relation to DPPs. I concentrate, therefore, on the differences.
	We propose that each sub-group should consist of 11 members made up of six political members appointed from among the members of the board and five independent members appointed by the board. This is a similar proportion to the balance on other DPPs but a smaller size to reflect the lesser role.
	The council is charged, in appointing political members of a sub-group, to seek to ensure that the sum total of all the political members of all the sub-groups taken together reflects the balance of parties within the council. The board has to ensure, in appointing independent members of a sub-group, that so far as is practicable members of the sub-group, taken together, are representative of the community.
	In addition, the schedule provides that the council should also notify the board whether applicants are interested in being considered for appointments to only one sub-group or whether there is flexibility.
	There is a slight difference for the appointment and rotation of chairmen and vice-chairmen. They will be appointed by the council which will be required to ensure, so far as is practicable, that the office of chairman and vice-chairman in each sub-group is at all times held by members of different political parties; and that the office of chairman is held in turn by each of the largest four parties represented on Belfast City Council.
	In addition to those provisions which apply also to DPPs, the council will be obliged to ensure that no one party holds more than one sub-group chairmanship at any point in time. The rules for disqualification and removal are exactly the same as those for membership of DPPs; and, similarly, as regards allowances, indemnities, insurance, finance, validity of proceedings and disclosure of interests.
	The arrangements relating to procedure reflect very closely the provisions for DPPs. The only difference is that the Belfast DPP is given the power to give directions to a sub-group about the regulation of its procedure.
	The arrangements for constituting committees are very similar to the DPP arrangements. A sub-group can set up a committee of its own volition or may be required to do so by the DPP. The Belfast DPP would need to approve the constitution of any committee set up by the sub-group of its own volition, its membership, the functions to be delegated to it and any directions that that sub-group might choose to give to the committee as to the way in which it carries out its work.
	Since they carry out a number of independent functions, we believe that it is appropriate for each sub-group to be designated in its own right for the purposes of the Freedom of Information Act 2000 and the Commissioner for Complaints (Northern Ireland) Order 1996. Noble Lords will have noted that the latter designation automatically brings sub-groups, in their own right, within the scope of the statutory equality duties set out in the Northern Ireland Act 1998.
	The final part of the new schedule goes to transitional arrangements. We wanted to keep disruption to a minimum. It is heartening that to date over 200 persons have applied to serve on the Belfast DPP. We are proposing that, if it believes it necessary in order to create a place for the sub-group chairmen on the main DPP, the council should be able to move one or more existing political members of the DPP to serve instead on one or more sub-groups.
	There is no equivalent provision for independent members. It would be inappropriate to alter the appointment of members of the public who have applied for appointment to the DPP.
	There is a provision that allows the board to consider as potential members of sub-groups individuals already appointed by independent membership of the Belfast DPP. That obviates the need for individuals to go through the full application process a second time.
	To address one or two further matters, I explained, when we discussed Amendments Nos. 48 and 49, that the provisions relating to Belfast will be commenced separately by order, subject to affirmative resolution of both Houses. Amendment No. 48A, tabled in the names of the noble Lords, Lord Smith and Lord Glentoran, creates an important further safeguard.
	That is a limited change from the original text for consideration, but, having listened carefully to representations, we thought it right that both issues be subject to the affirmative resolution commencement procedure. I hope that that commends itself to your Lordships as a useful improvement. I therefore reiterate my assurance that both Houses will have the opportunity to have a full debate.
	Paragraph 10 of the new schedule inserted by Amendment No. 52 provides that, before issuing or revising a local policing plan under Section 22 of the 2000 Act, the district commander shall consult the relevant sub-group, in addition to the main DPP, and take account of any views expressed.
	We think that to be a practical requirement. It would be odd if the district commander were to be denied the views of the sub-groups when it came to drawing up the annual plan. However, I assure your Lordships that each commander will also be required to seek the views of the main Belfast DPP, and I am sure that the PSNI will ensure a homogeneity about the policy approach to Belfast while recognising the relevance of local issues.
	Finally, I turn to paragraph 2 of the new schedule, inserted by Amendment No. 52. Section 15 of the 2000 Act provides for the circumstances in which a district council fails to set up a DPP. We wanted to ensure a similar provision if Belfast City Council failed to set up the sub-groups. New Section 15A does just that.
	I hope that the amendments commend themselves to your Lordships and that, in due time, the noble Lord, Lord Glentoran, will be sufficiently content not to press his amendments. I beg to move.
	Moved, That the House do agree with the Commons in their Amendment No 15.—(The Lord Privy Seal.)

Lord Glentoran: rose to move, as an amendment to the Motion that the House do agree with the Commons in their Amendment No. 15: 15A
	Leave out "agree" and insert "disagree".

Lord Glentoran: My Lords, I thank the noble and learned Lord for so clearly laying the Commons amendment before us. As he rightly pointed out, the amendment is covered by Amendment No. 48A, which is to come, but he indicated that the Government will agree to that amendment. I have three issues with the amendment. I start with the second, the first having been debated on my Amendment No 14A when we lost the Division.
	This amendment is equally iniquitous. To divide Belfast into four segments, as planned, for four sub-group DPPs—one for each tribal area, as it were—although two areas are perhaps not totally tribal; one is divided and, sadly, continually fighting against itself at present; the other tends to be rather more peaceful. East Belfast is dominated by gang lands of one sort of another; West Belfast is dominated by the paramilitaries of Sinn Fein/IRA.
	What Sinn Fein really wants is to get control of the Police Service of Northern Ireland. There is a strange similarity between the demands that Martin McGuinness made in his speech at the Ard Fheis and in his comments to The Times—to which I referred earlier—and those in the Weston Park agreements. I do not suppose that your Lordships will be surprised about that.
	However, I shall be at risk of repeating myself if I say much more. I think that I made my arguments clear during the Bill's earlier stages. My view has not changed, but perhaps I tend to become more pragmatic as the day goes on. I hope that the amendment to which the noble and learned Lord will later agree will give us what we want—further safeguards about timing. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Rogan: had given notice of his intention to move, as an amendment to Commons Amendment No. 15, Amendment No. 15B:
	15BLine 5, at end insert—
	"(3) The Secretary of State shall not make an order under subsection (2) until acts of completion have occurred.
	(4) In subsection (3), "acts of completion" means—
	(a) that the decommissioning of firearms, ammunition and explosives held by one of the organisations specified under Schedule 2 to the Terrorism Act 2000 has occurred and has been verified under section 3 of the Northern Ireland Arms Decommissioning Act 1997 by the Commission;
	(b) there has been a statement from that organisation ordering the termination of acts of paramilitary violence by that organisation, including—
	(i) shootings;
	(ii) beatings;
	(iii) threats;
	(iv) intimidations; and
	(c) there has been a statement from that organisation removing any threats to those who left their homes due to intimidation by that organisation.
	(5) The Secretary of State may by order add further acts to those listed in subsection (4) above."

Lord Rogan: My Lords, the competent arguments that I would plead to support Amendment No. 15B I made before lunch when speaking to Amendment No. 14C—obviously not terribly effectively as I lost the Division. I therefore do not want to move Amendment No. 15B.

[Amendment No. 15B not moved.]
	On Question, Amendment No. 15 agreed to.

COMMONS AMENDMENT

52Before Schedule 1, insert the following new schedule—

"BELFAST

1 The Police (Northern Ireland) Act 2000 (c.32) is amended as set out in paragraphs 2 to 13.
	2 After section 15 insert—
	"15A DEFAULT OF COUNCIL: BELFAST SUB-GROUPS
	(1) If the Secretary of State is satisfied that the district council for Belfast has failed to comply with—
	(a) section 21(1), or
	(b) any provision of Schedule 3A,
	he may, after consulting the Board, direct the council to take, within such period as is specified in the direction, such action for the purpose of remedying the default as is so specified.
	(2) If the council fails to comply with a direction under subsection (1), the Secretary of State may—
	(a) declare the council to be in default; and
	(b) make an order empowering the Board to exercise the functions of the council to such extent as appears to him necessary or expedient to secure that a sub-group of the council's district policing partnership is established for each police district established under section 20(2).
	(3) An order under subsection (2) may provide for Schedule 3A to have effect in relation to the exercise by the Board of any functions of the council with such modifications as may be specified in the order.
	(4) An order under subsection (2) may confer on the Board power to remove any members of a sub-group of the council's district policing partnership holding office at the date of the order.
	(5) Any costs incurred by the Board under an order under subsection (2) shall in the first instance be defrayed as expenses of the Board, but—
	(a) an amount equal to one quarter of those costs as certified by the Board shall on demand be paid to the Board by the council; and
	(b) any sums demanded under paragraph (a) may be recovered summarily by the Board as a debt.
	(6) A sub-group established in pursuance of an order under subsection (2) shall be treated as having been established under section 21."
	3 In section 17 (annual report by district policing partnership to council) after subsection (1) insert—
	"(1A) Subsection (1) does not apply to the district policing partnership for Belfast."
	4 In section 18 (reports by district policing partnership to Board) after subsection (1) insert—
	"(1A) Subsection (1) does not apply to the district policing partnership for Belfast."
	5 For section 21 substitute—
	"21 DISTRICT POLICING PARTNERSHIP SUB-GROUPS FOR BELFAST
	(1) The district council for Belfast shall establish a sub-group of its district policing partnership for each police district established under section 20(2).
	(2) The functions of each sub-group shall be—
	(a) to provide views to the district commander of the sub-group's police district and to the district policing partnership on any matter concerning the policing of that police district;
	(b) to monitor the performance of the police in carrying out—
	(i) the policing plan in relation to the police district; and
	(ii) the local policing plan applying to the police district;
	(c) to make arrangements for obtaining—
	(i) the views of the public about matters concerning the policing of the police district; and
	(ii) the co-operation of the public with the police in preventing crime;
	(d) to act as a general forum for discussion and consultation on matters affecting the policing of the police district.
	(3) The code issued under section 19 may contain guidance as to the exercise by sub-groups of their functions.
	(4) In exercising its functions a sub-group shall have regard to any such guidance contained in the code.
	(5) If the district policing partnership is satisfied that a sub-group is carrying out any of the sub-group's functions in relation to a police district, the partnership is not required to carry out any corresponding function it has in relation to the part of the district comprising the police district.
	(6) Schedule 3A shall have effect in relation to the sub-groups."
	6 After section 21 insert—
	"21A ANNUAL REPORT BY SUB-GROUPS TO BELFAST DISTRICT POLICING PARTNERSHIP
	(1) A sub-group established under section 21 shall, not later than 2 months after the end of each financial year, submit to the district policing partnership for Belfast a general report on the exercise of its functions during that year.
	(2) A report under subsection (1) shall include details of the arrangements made under section 21(2)(c).
	(3) Before submitting any report under subsection (1), a sub-group shall consult the district commander of its police district."
	7 After section 21A (inserted by paragraph 6 above) insert—
	"21B ANNUAL REPORT BY BELFAST DISTRICT POLICING PARTNERSHIP TO COUNCIL
	(1) The district policing partnership for Belfast shall, not later than 4 months after the end of each financial year, submit to the district council for Belfast a general report on the exercise during that year of—
	(a) its functions;
	(b) the functions of the sub-groups established under section 21.
	(2) When the district policing partnership submits its report under subsection (1) it shall at the same time—
	(a) send to the council copies of the sub-group reports for the year;
	(b) send copies of its report and the sub-group reports for the year to the Board.
	(3) If the district policing partnership has made arrangements under section 16(1)(c) the report under subsection (1) shall include details of the arrangements.
	(4) Before submitting any report under subsection (1), the district policing partnership shall consult the district commander of each police district in the district of Belfast.
	(5) The district council shall arrange for a report submitted under subsection (1) to be published in such manner as appears to the council to be appropriate.
	(6) The district council may arrange for a sub-group report to be published with the report submitted under subsection (1) if—
	(a) the council considers publication of the sub-group report to be appropriate, or
	(b) the district policing partnership has requested the publication of the sub-group report.
	(7) A "sub-group report" is a report submitted to the district policing partnership under section 21A."
	8 After section 21B (inserted by paragraph 7 above) insert—
	"21C OTHER REPORTS BY SUB-GROUPS TO BELFAST DISTRICT POLICING PARTNERSHIP
	(1) A sub-group established under section 21 shall, whenever so required by the district policing partnership for Belfast, submit to the partnership a report on any matter which is specified in the requirement and is connected with the exercise of its functions.
	(2) A report under this section shall be made—
	(a) in such form as may be specified in the requirement under subsection (1); and
	(b) within the period of 2 months from the date on which that requirement is made, or within such longer period as may be agreed between the sub-group and the partnership.
	(3) The partnership may arrange for a report submitted under this section to be published in such manner as appears to the partnership to be appropriate.
	(4) Subsection (3) does not apply if the partnership has imposed the requirement under subsection (1) to enable it to comply with a requirement imposed on it under section 21D(1)."
	9 After section 21C (inserted by paragraph 8 above) insert—
	"21D REPORTS BY BELFAST DISTRICT POLICING PARTNERSHIP TO BOARD
	(1) The district policing partnership for Belfast shall, whenever so required by the Board, submit to the Board a report on any matter which is specified in the requirement and is connected with the exercise of—
	(a) its functions, or
	(b) the functions of a sub-group established under section 21.
	(2) A report under this section shall be made—
	(a) in such form as may be specified in the requirement under subsection (1); and
	(b) within the required period or such longer period as may be agreed between the district policing partnership and the Board.
	(3) The required period is—
	(a) 4 months from the date on which the requirement under subsection (1) is made, if the requirement relates wholly or in part to the functions of a sub-group;
	(b) 3 months from the date on which the requirement under subsection (1) is made, in any other case.
	(4) When the district policing partnership submits its report under subsection (1) it shall at the same time send to the Board copies of any related sub-group report.
	(5) The Board may arrange for the publication, in such manner as appears to the Board to be appropriate, of—
	(a) a report submitted under subsection (1);
	(b) a related sub-group report.
	(6) A "sub-group report" is a report submitted to the district policing partnership under section 21C.
	(7) A sub-group report is related to a report submitted in pursuance of a requirement under subsection (1) if the district policing partnership imposed the requirement to submit the sub-group report to enable it to comply with the requirement under subsection (1)."
	10 In section 22 (the local policing plan) after subsection (3) insert—
	"(3A) Before issuing or revising a local policing plan for a police district established under section 20(2), the district commander shall also consult the sub-group established for the district under section 21 and take account of any views expressed."
	11 (1) Schedule 1 (the Northern Ireland Policing Board) is amended as follows.
	(2) In paragraph 3(7) (disqualification from membership of Board during suspension of devolved government), after paragraph (b)(iii) insert—
	"; or
	(iv) a member of a sub-group established under section 21.".
	(3) In paragraph 10(1)(b) (disqualification from membership of Board during devolved government), after "district policing partnership;" insert—
	"or
	(iv) a member of a sub-group established under section 21;".
	12 In Schedule 3 (district policing partnerships) after paragraph 16 insert—
	"Belfast district policing partnership
	17 (1) The preceding paragraphs of this Schedule have effect in relation to the district policing partnership for Belfast with the following modifications.
	(2) In paragraph 2 after sub-paragraph (5) insert—
	"(6) The members of the DPP who are appointed by the council in accordance with paragraph 3 shall include the persons who hold the office of chairman of each of the sub-groups of the DPP established under section 21."
	(3) In paragraph 5 after sub-paragraph (3) insert—
	"(3A) In relation to each person nominated by it under sub-paragraph (1) the council shall also notify the Board of—
	(a) whether the person is also willing to be a candidate for appointment as an independent member of a sub-group established under section 21;
	(b) the sub-group or sub-groups concerned, if he is so willing.""
	13 After Schedule 3 insert—
	"SCHEDULE 3A
	BELFAST SUB-GROUPS
	Interpretation
	1 (1) In this Schedule—
	"the council" means the district council for Belfast;
	a "declaration against terrorism" means a declaration in the form set out in Part 1 of Schedule 2 to the Elected Authorities (Northern Ireland) Act 1989, with the substitution of the words "if appointed" for the words "if elected";
	"independent member", in relation to a sub-group, means a member appointed under paragraph 2(4);
	"local general election" has the same meaning as in the Electoral Law Act (Northern Ireland) 1962;
	"the partnership" means the district policing partnership for Belfast;
	"political member", in relation to a sub-group, means a member appointed under paragraph 2(3);
	"sub-group" means a sub-group established under section 21.
	(2) For the purposes of this Schedule an independent member of the council shall be treated as a party.
	Size and composition
	2 (1) A sub-group shall consist of 11 members.
	(2) The members of a sub-group need not be members of the partnership.
	(3) Six of the members of a sub-group shall be appointed by the council from among members of the council in accordance with paragraph 3.
	(4) Five of the members of a sub-group shall be appointed in accordance with paragraph 4.
	Political members
	3 (1) The council shall exercise its power to appoint political members of a sub-group so as to ensure that, so far as practicable, the political members of all the sub-groups, taken together, reflect the balance of parties prevailing among the members of the council immediately after the last local general election.
	(2) Subject to the following provisions of this paragraph, a person shall hold and vacate office as a political member in accordance with the terms of his appointment.
	(3) A political member shall hold office until the date of the local general election next following his appointment.
	(4) A person appointed to fill a casual vacancy shall hold office for the remainder of the term of the political member in whose place he is appointed.
	(5) A political member shall cease to hold office if—
	(a) he resigns by notice in writing to the council;
	(b) he becomes disqualified for membership of a sub-group; or
	(c) he ceases to be a member of the council.
	(6) A person whose term of office as a political member expires or who has resigned shall be eligible for re-appointment.
	Independent members
	4 (1) Appointments of independent members shall be made by the Board from among persons nominated by the council in accordance with paragraph 5.
	(2) In appointing independent members of a sub-group the Board shall so far as practicable secure that the members of the sub-group (taken together) are representative of the community in the sub-group's police district.
	(3) Subject to the following provisions of this paragraph, a person shall hold and vacate office as an independent member in accordance with the terms of his appointment.
	(4) An independent member shall hold office until the date of the local general election next following his appointment.
	(5) A person appointed to fill a casual vacancy shall hold office for the remainder of the term of the independent member in whose place he is appointed.
	(6) An independent member shall cease to hold office if—
	(a) he resigns by notice in writing to the council; or
	(b) he becomes disqualified for membership of a sub-group.
	(7) A person whose term of office as an independent member expires or who has resigned shall be eligible for re-appointment.
	The council's nominations
	5 (1) Where appointments are to be made of independent members of a sub-group, the council shall nominate persons willing to be candidates for appointment.
	(2) Unless otherwise agreed with the Board, the number of persons to be nominated under sub-paragraph (1) on any occasion shall be twice the number of appointments to be made of independent members.
	(3) The council shall notify the Board of—
	(a) the name of each person nominated by it under sub-paragraph (1); and
	(b) such other information regarding those persons as it considers appropriate.
	(4) In relation to each person nominated by it under sub-paragraph (1) the council shall also notify the Board of—
	(a) whether the person is also willing to be a candidate for appointment as an independent member of any other sub-group;
	(b) the sub-group or sub-groups concerned, if he is so willing;
	(c) whether the person is also willing to be a candidate for appointment as an independent member of the partnership.
	(5) A person shall not be nominated under sub-paragraph (1) if—
	(a) he is disqualified for membership of a sub-group, or
	(b) he has not made a declaration against terrorism.
	(6) Where the number of persons nominated by the council is less than twice the number of appointments to be made, the Board may itself nominate such number of candidates as when added to the number nominated by the council equals twice the number of appointments to be made.
	(7) If the Board does so, paragraph 4(1) shall have effect as if those persons had been nominated by the council.
	Code of practice on appointment of independent members
	6 (1) In exercising functions under paragraphs 4 and 5, the council and the Board shall have regard to any code of practice under this paragraph.
	(2) The Secretary of State may issue, and from time to time revise, a code of practice containing guidance as to the exercise by the council and the Board of their functions under paragraphs 4 and 5.
	(3) Before issuing or revising a code of practice under this paragraph, the Secretary of State shall consult—
	(a) the Board;
	(b) the council; and
	(c) the Equality Commission for Northern Ireland.
	(4) The Secretary of State shall arrange for any code of practice issued or revised under this paragraph to be published in such manner as appears to him to be appropriate.
	Removal of members from office
	7 (1) The Board, or the council with the approval of the Board, may remove a person from office as a political or independent member of a sub-group if satisfied that—
	(a) in the case of an independent member, he failed to make the necessary disclosure in relation to a conviction of his for a criminal offence in Northern Ireland or elsewhere;
	(b) in the case of an independent member, he has acted in breach of the terms of a declaration against terrorism;
	(c) he has been convicted of a criminal offence in Northern Ireland or elsewhere committed after the date of his appointment;
	(d) he has become bankrupt or made a composition or arrangement with his creditors;
	(e) he has failed to comply with the terms of his appointment; or
	(f) he is otherwise unable or unfit to discharge his functions as a member of the sub-group.
	(2) "The necessary disclosure", in relation to a conviction of an independent member, means full disclosure of it—
	(a) before his nomination, to the council;
	(b) before his appointment, to the Board.
	(3) Section 6 of the Elected Authorities (Northern Ireland) Act 1989 applies to determine whether an independent member has acted in breach of the terms of a declaration against terrorism as it applies to determine whether a person who has made a declaration required for the purpose of section 3, 4 or 5 of that Act has acted in breach of the terms of the declaration.
	(4) As applied by sub-paragraph (3), section 6 of the Elected Authorities (Northern Ireland) Act 1989 applies with the following modifications—
	(a) in subsection (1), for the words from "after" to "the Assembly" substitute "when he is an independent member of a sub-group established under section 21 of the Police (Northern Ireland) Act 2000";
	(b) omit subsection (4);
	(c) in subsection (5), in the definition of "public meeting" after paragraph (c) insert—
	"(d) any meeting of a sub-group established under section 21 of the Police (Northern Ireland) Act 2000 or a committee of such a sub-group (whether or not a meeting which the public is permitted to attend), and
	(e) any meeting of a district policing partnership or a committee of a district policing partnership (whether or not a meeting which the public is permitted to attend),".
	Disqualification
	8 (1) A person is disqualified for membership of a sub-group if he is—
	(a) a police officer;
	(b) a member of the police support staff;
	(c) a member of the Board; or
	(d) an employee of the council.
	(2) A person removed from office under paragraph 7(1) is disqualified for membership of a sub-group until the date of the next local general election following his removal.
	(3) A person is disqualified for being an independent member of a sub-group if—
	(a) he has been convicted in Northern Ireland or elsewhere of any offence and has had passed on him a sentence of imprisonment or detention, and
	(b) the relevant period has not ended.
	(4) The relevant period is the period of five years beginning with the person's discharge in respect of the offence.
	(5) For the purposes of sub-paragraph (4) the following are to be treated as the discharge of a person (whether or not his release is subject to conditions)—
	(a) his release on licence;
	(b) his release in pursuance of a grant of remission.
	(6) Sub-paragraph (5) does not apply in relation to the release of a person in respect of an offence if he is required to return to prison or detention for a further period in respect of the offence.
	(7) Subject to sub-paragraph (8), the reference in sub-paragraph (3) to a sentence of imprisonment or detention does not include a suspended sentence.
	(8) Sub-paragraph (7) does not apply in relation to a suspended sentence that has been ordered to take effect.
	(9) In this paragraph "suspended sentence" means a sentence of imprisonment or detention that is ordered not to take effect unless the conditions specified in the order are met.
	Chairman and vice-chairman
	9 (1) There shall be a chairman and vice-chairman of a sub-group appointed by the council from among the political members.
	(2) In making appointments under sub-paragraph (1), the council shall ensure that, so far as practicable—
	(a) the office of chairman and vice-chairman are at all times held by members of different political parties;
	(b) a person is appointed to the office of chairman or vice-chairman for a term of 12 months at a time or, where that period is shorter than 12 months, for a period ending with the date of the local general election next following his appointment;
	(c) the office of chairman is held in turn by each of the four largest parties represented on the council immediately after the last local general election;
	(d) the office of chairman is not held by a person who is a member of the same political party as a person who holds the office of chairman of another sub-group.
	(3) Subject to the following provisions of this paragraph, a person shall hold and vacate office as chairman or vice-chairman in accordance with the terms of his appointment.
	(4) A person may at any time resign as chairman or vice-chairman by notice in writing to the council.
	(5) If the chairman or vice-chairman ceases to be a member of the sub-group, he shall also cease to hold office as chairman or vice-chairman.
	Allowances
	10 The council may pay to the chairman, vice-chairman and other members of a sub-group such allowances as the council, with the approval of the Board, may determine.
	Indemnities
	11 The council may indemnify a member of a sub-group in respect of liability incurred by him in connection with the business of the sub-group.
	Insurance against accidents
	12 (1) The council may insure against risks of a member of a sub-group meeting with a personal accident, whether fatal or not, while he is engaged on the business of the sub-group.
	(2) Sub-paragraph (3) applies if the council receives a sum under any such insurance in respect of an accident to a member of the sub-group.
	(3) The council shall pay the sum to the member or his personal representatives, after deducting any expenses incurred in its recovery.
	(4) The provisions of the Life Assurance Act 1774 as extended by the Life Insurance (Ireland) Act 1866 do not apply to any insurance under this paragraph.
	Finance
	13 The Board shall for each financial year make to the council a grant equal to three-quarters of the expenses reasonably incurred by the council in that year in connection with the establishment of, or the exercise of functions by, sub-groups.
	Procedure
	14 (1) The quorum for a meeting of a sub-group shall be 5.
	(2) Every question at a meeting of a sub-group shall be determined by a majority of the votes of the members present and voting on the question, and in the case of an equal division of the votes, the chairman of the meeting shall have a second or casting vote.
	(3) If the chairman and vice-chairman are absent from a meeting of a sub-group, the members present shall elect one of their number to act as chairman of the meeting.
	(4) Subject to sub-paragraphs (1) to (3) and to section 19 and to any directions given by the partnership, a sub-group may regulate its own procedure.
	Validity of proceedings
	15 The validity of any proceedings of a sub-group or a committee thereof shall not be affected by—
	(a) any defect in the appointment of the chairman or vice-chairman or any other member; or
	(b) any vacancy in the office of chairman or vice-chairman or among the other members.
	Disclosure of pecuniary interests, family connections, etc.
	16 Sections 28 to 33, 42, 46, 47 and 146 of the Local Government Act (Northern Ireland) 1972 (and section 148 of that Act so far as applying for the interpretation of those sections) apply to a sub-group and its members as if—
	(a) in those sections—
	(i) any reference to a council were a reference to the sub-group;
	(ii) any reference to a councillor were a reference to a member of the sub-group;
	(iii) any reference to the clerk of the council were a reference to the person acting as secretary of the sub-group;
	(b) in section 28(4) of that Act for the words from "by any local elector" to the end there were substituted the words "by any person";
	(c) in section 29 of that Act any reference to the Minister were a reference to the Secretary of State.
	Committees
	17 (1) A sub-group may constitute a committee of its members.
	(2) A sub-group shall constitute a committee of its members if directed to do so by the partnership.
	(3) A committee of a sub-group shall consist of 5 or more members of the sub-group.
	(4) The members of a committee of a sub-group shall be appointed by the sub-group.
	(5) A sub-group may delegate any of its functions to a committee constituted by it.
	(6) The powers of a committee of a sub-group shall be exercised in accordance with and subject to directions given by the sub-group.
	(7) The proceedings of a committee of a sub-group shall be regulated in accordance with and subject to directions given by the sub-group.
	(8) The approval of the partnership is required to—
	(a) the constitution of a committee under sub-paragraph (1);
	(b) the members of a committee of a sub-group to be appointed under sub-paragraph (4);
	(c) the functions to be delegated to a committee under sub-paragraph (5);
	(d) the exercise by a committee of any functions delegated to it under sub-paragraph (5);
	(e) the directions to be given to a committee under sub-paragraphs (6) and (7)."
	14 In Schedule 2 to the Commissioner for Complaints (Northern Ireland) Order 1996 (N.I. 7) after the entry for the Staff Commission for Education and Library Boards insert—
	"A sub-group established under section 21 of the Police (Northern Ireland) Act 2000."
	15 In Part 7 of Schedule 1 to the Freedom of Information Act 2000 (c.36) at the appropriate place in alphabetical order insert—
	"A sub-group established under section 21 of the Police (Northern Ireland) Act 2000."
	16 (1) Sub-paragraphs (4) and (5) have effect in relation to the transitional period.
	(2) The transitional period is the period—
	(a) beginning on the date on which this Schedule comes into force;
	(b) ending on the date of the next local general election after that date.
	(3) "Local general election" has the same meaning as in the Electoral Law Act (Northern Ireland) 1962.
	(4) In paragraph 17 of Schedule 3 to the Police (Northern Ireland) Act 2000 (inserted by paragraph 12 above) after sub-paragraph (2) insert—
	"(2A) In paragraph 3, after sub-paragraph (4) insert—
	"(4A) The council may, with the approval of the Board, terminate the appointment of a political member if it appears to the council to be necessary or expedient to do so in order to enable it to comply with paragraph 2(6)."
	(2B) In paragraph 3(5), after paragraph (a) insert—
	"(aa) his appointment is terminated under sub-paragraph (4A);".
	(2C) In paragraph 3(6), after "expires" insert ", whose appointment is terminated under sub-paragraph (4A)"."
	(5) In Schedule 3A to the Police (Northern Ireland) Act 2000 (inserted by paragraph 13 above), in paragraph 4(1) after "among" insert "(a)" and after "paragraph 5" insert—
	"; and
	(b) persons who hold office as independent members of the partnership"."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 52. As your Lordships will appreciate, I have already spoken to this amendment in the context of Commons Amendment No. 15. I beg to move.
	Moved, That the House do agree with the Commons in their Amendment No. 52.

[Amendment No. 52A not moved.]
	On Question, Amendment No. 52 agreed to.

COMMONS AMENDMENTS

4 Clause 9, page 6, line 26, leave out from "to" to end of line 27 and insert "a special purposes committee."
	5 Page 6, line 42, leave out from second "to" to end of line 43 and insert "a special purposes committee."
	6 Page 7, line 1, leave out second "the" and insert "a"
	7 Page 7, line 2, leave out from "shall" to end of line 5 and insert "prepare a summary of the information.
	(4F) The Chief Constable shall try to obtain the agreement of the committee to the terms of the summary.
	(4FA) If the committee agrees to the terms of the summary, the Chief Constable shall include the summary in the report to the Board."
	8 Page 7, line 7, leave out second "the" and insert "a"
	9 Clause 11, page 8, line 23, leave out "(2) and" and insert "(1A) to"
	10 Page 8, line 23, at end insert—
	"(1A) In sub-paragraph (3) for "that day" substitute "the day on which the chairman calls the meeting"."
	11 Page 8, line 34, leave out "held" and insert "called"
	12 Clause 12, page 9, line 30, leave out ", or information contained in a document,"

Lord Williams of Mostyn: My Lords, with the leave of the House, I beg to move that the House do agree with the Commons in their Amendments Nos. 4 to 12 en bloc.
	The amendments relate to the clauses that deal with the requirement on the Chief Constable to report and provide information to the board and the police ombudsman. At Third Reading in this House, we tabled a series of amendments designed to respond to various concerns raised by your Lordships. Those included provision for a small committee within the board with whom the Chief Constable might share any sensitive information that he decided ought to be kept on a restricted circulation.
	I said at the time, and my colleagues in the Commons also made it plain, that we would open-mindedly consider any further proposals. Our conclusion was that some of our proposals were too complex. The amendments introduced on Report in the Commons sought to address those concerns and to streamline the interlocking provisions. I have written to all of your Lordships who show an interest in Northern Ireland affairs describing the effect and purpose of the changes, so I shall try to be reasonably concise.
	Essentially, the Government view new Section 33A as very much an everyday power of the board to request and receive information from the Chief Constable. It is not envisaged that sensitive information would be routinely supplied through that route unless deemed appropriate by the Chief Constable. The board is guaranteed access to non-sensitive information that it seeks through that route and, in certain circumstances, might gain access to sensitive information, subject to the professional judgement of the Chief Constable.
	The arrangements surrounding access to information—particularly sensitive information—are of necessity complex. There is a great need for transparency and accountability, but we also need to have a sensible balance, taking into account the need for appropriate safeguards on sensitive information.
	Perhaps I may briefly set out how we see the balance being reflected by the Chief Constable in relation to his duty to protect life under Section 32(1)(a) of the 2000 Act. In addition, as a member of the PSNI, he is bound by the code of ethics provided for in Section 52 and, by the terms of the attestation in Section 38(1), to uphold fundamental human rights. There are already some safeguards in Section 59 to allow the Chief Constable to refer certain requests to the Secretary of State. There are further safeguards in the amendments that we introduced as part of the Bill that would allow the Chief Constable to limit the distribution of certain information within the board. There is also an important protection in Section 3(1) of the Human Rights Act 1998, which provides that
	"so far as it is possible to do so, primary legislation . . . must be read and given effect in a way which is compatible with the Convention rights".
	If there is a direct tension between the Chief Constable's duty under Section 59 to produce a report for the board and his duty to protect life under Section 32(1), he is obliged as a matter of law to weigh those duties and to fulfil his Section 59 duty in such a way as to be consistent with his Section 32(1) duty. He would judge each case on its merits. I know that the Chief Constable wishes to provide as much information as possible to the board—and that is plainly right.
	There is also a duty on the Chief Constable under Section 6(1) of the Human Rights Act 1998, which provides that
	"it is unlawful for a public authority to act in a way which is incompatible with a Convention right".
	That applies to the Chief Constable's duty under Section 59 just as it does to the duty of a beat constable on the street. Both would act unlawfully if they acted incompatibly with the ECHR.
	The issue is not whether the Chief Constable provides a complete report or piece of information—or nothing at all. Rather, he would be obliged to provide the information in such a way as to avoid the risk to an individual's life. For example, he could ensure that the way in which he provides the information to the board avoids mentioning a vulnerable individual by name or identifying him. That would protect the individual's right to life, while still ensuring that the board had access to the information.
	Moving on, the criteria on which the Chief Constable may withhold information in response to a request made under Section 33A are set out in Amendment No. 17. They are, that the disclosure of the information would be likely to endanger an individual—there are special provisions for dealing with this type of information in the context of a Section 59 report, under the amendments to Clauses 9 and 21; that the information requested relates to one of the three grounds of referral set out in Section 76A—laid out in Clause 22—on which, were the request made under Section 59, he would be able to refer to the Secretary of State; or that the grounds of referral set out in the Bill and approved by your Lordships on 30th January are unaffected by the amendments made in another place.
	Before I turn to the amendments tabled by noble Lords, it may be helpful if I explain that the phrase "sensitive personnel information" in the revised second ground of referral refers to sensitive information relating to an individual's holding of office or employment specifically where that office or employment comes under the control or direction of the Chief Constable. Elsewhere it means police officers—including reservists, trainees and secondees; police support staff; traffic wardens; police cadets; and designated contractors staff under the Bill.
	In light of the change to Clause 18 brought about by Amendment No. 17, we no longer see the need for the small committee provided for under Clause 21 to have a role in relation to Section 33A or to restrict the board's access to documents. Amendment No. 18 therefore removes the provisions in Clause 18 relating to the committee. Amendments Nos. 19 to 21, 25, 26, 29, 30 and 37 are consequential. Amendment No. 16 gives the board access to documents as well as to information. Based on our legal advice that subsequent references to "information" in the clause would encompass "documents" as well as other information, we seek to amend the wording of Clause 12, through Amendment No. 12, to make the Bill consistent.
	The fourth ground of referral, now dropped, dealt with information likely to prejudice the detection of crime or prosecution of offenders. The Government's position was set out in the updated implementation plan published in August 2001. It reflects more fully the Patten recommendations. Amendments Nos. 17A and 26A would reintroduce that fourth ground of referral to requests for information under Section 33A of the 2000 Act and would make any unauthorised disclosure of such information an offence. The effect would be to apply the fourth ground only in the context of everyday requests for information and not in relation to Section 59 requests for reports.
	Your Lordships debated the fourth ground of referral at length, as did our colleagues in another place. The primary statutory duty of the Policing Board under Section 3 of the 2000 Act is to maintain an effective police service in Northern Ireland. It would be contrary to that duty for the board to request information or a report within a timescale that could prejudice a major continuing investigation. Under Section 59(2)(b) of the 2000 Act there is already a provision for the board and the Chief Constable to agree a timescale for the production of a report. We are confident that both organisations would seek to reach a sensible accommodation on a timescale. When we last discussed that issue, I assured your Lordships that the Government would provide in the code of practice issued by the Secretary of State on reports and inquiries for the board to seek the guidance of Her Majesty's Inspector of Constabulary on timing. Given the inspector's operational expertise, his views will plainly carry significant weight with board members.
	The grounds set out in the Bill, when taken with the other safeguards provided for in the Bill and in existing legislation, get the balance right between ensuring that the board has proper access to information and that sensitive information—and issues—are adequately protected. My honourable friend the Minister of State in another place stated on Report that she had consulted with the Chief Constable and that he was satisfied with the Bill's safeguards. He felt that he would still be able to protect information that he regarded as sensitive and work within the openness that he sought to establish with the board. We ought to draw significant comfort from that statement. I do not believe that Amendments Nos. 17A and 26A are necessary or appropriate and ask that they be withdrawn.
	A good deal of criticism and concern has been expressed but, at the end of the day, I hope that your Lordships will feel that we have been open-minded and have achieved a workable outcome.
	The issue of the small committee attracted a certain amount of attention in another place. I have already indicated that we do not see that committee as having a role relative to new Section 33A. The effect of Amendments Nos. 42 and 43 is that the board shall have discretion over whether or not to set up a committee to deal with sensitive information—with the exception of three specific circumstances, where it would be essential that such a committee be established to safeguard information that the Chief Constable or the Secretary of State has determined should be shared with a limited number of persons. It includes information that may come from a person conducting a Section 60 inquiry, where the Chief Constable has previously advised that it is too sensitive to be shared widely. That would give the board freedom to decide whether or not to establish a committee from the outset. The board can also decide whether it should be a standing or an ad hoc committee.
	Amendment No. 43 increases the committee's membership to seven, which will allow the board greater flexibility in its selection processes. We expect that the board would normally wish to include both the chairman and the vice-chairman. Membership could also include representatives from the political parties on the board as well as an independent voice. All other terms of the constitution of the committee remain as previously set out in the Bill.
	Amendment No. 44 gives the small committee a specific title—"special purposes committee"—to clarify its special function and to make references to it in the legislation less cumbersome. Amendments Nos. 4 to 6, 8, 28, 32, 36 and 38 have been made in consequence of this and the other substantive amendments to Clause 21 that I have outlined.
	Clause 9 deals with Section 59 reports under the 2000 Act. Amendment No. 7 obliges the Chief Constable to try to obtain the agreement of the special purposes committee to the terms of a non-sensitive summary of the information that he has supplied to it. The Chief Constable must make real and demonstrable efforts to reach agreement with the special purposes committee. If and when agreement is reached, the summary will be provided to the board as part of the Chief Constable's report under Section 59. That puts a greater onus on the Chief Constable in relation to the board than the previous formulation, which merely required him to take account of the committee's views. It is yet another step that we are taking in recognising the role of the board, while being careful not to compromise that of the Chief Constable.
	I turn to the threshold for initiating inquiries. Many of your Lordships had concerns about Clause 11. I outlined the safeguards that existed within the 2000 Act. Your Lordships were afraid that a small minority on the board could force through, against the will of their colleagues, a decision to initiate an inquiry.
	The safeguards are set out in Section 60 and paragraph 18 of Schedule 1 to the 2000 Act. First, a proposal to initiate an inquiry cannot come out of the blue because the board must initially commission a report from the Chief Constable under Section 59. Only once that report has been received can an inquiry be contemplated. If the chairman receives a request to set up an inquiry, he must call a meeting no later than three working days after receipt of the request. That meeting is to be held no earlier than six days and no later than 21 days after that date. As I reminded your Lordships on a number of occasions, the chairman is obliged to notify each member of the board of the date and purpose of the meeting.
	That brings me to Amendment No. 10. This amendment would amend paragraph 18(3) of Schedule 1 to the 2000 Act, to put, beyond doubt, that a minimum of six working days must elapse between the board chairman calling a meeting to discuss a proposal to set up an inquiry and the meeting itself taking place. A number of your Lordships were concerned that there might be dishonourable behaviour. That is intended to put that beyond doubt.
	Amendments Nos. 9 and 11 are consequential. It could be read either in the way that I indicated—which I think is appropriate—or that the effect of "that day" in paragraph 18(3) is that the six day period starts from the day on which the chairman receives the request to call a meeting. This is an important safeguard. We do not want ambiguity on timescales and that is why this amendment has been brought forward to clarify matters.
	As regards improper disclosure, there are a number of "tidying up" amendments relating to Clause 20. This deals with the new offence of improper disclosure of sensitive information—an issue to which a number of your Lordships drew attention at various earlier stages. Amendment No. 41 provides that the provisions of Section 59(5) of the 2000 Act do not cut across the offence provisions—that is, the board would need to take account, before deciding to publish a report, of whether the Chief Constable had flagged up any of its contents as sensitive. If he had, the board would need to decide whether to redact that part of the report and publish the rest, or not to publish the report at all.
	Amendments Nos. 31, 33 and 34 make it clear that any person assisting a person conducting an inquiry under Section 60 is covered by the offence, irrespective of whether they are secondees from the board's own staff or direct recruits. Amendments Nos. 35, 39 and 40 clarify that it should not be an offence for the board or any special purposes committee of it to share sensitive information with the ombudsman's staff in connection with any of the ombudsman's functions.
	Before I beg to move, I realise that this explanation is a little lengthy, but it is, I hope, in respect and recognition of the concerns that your Lordships raised.
	Moved, That the House do agree with the Commons in their Amendments Nos. 4 to 12.—(Lord Williams of Mostyn.)

Lord Glentoran: My Lords, I beg to take issue with the noble and learned Lord that the explanation was a little lengthy; it was extremely lengthy. But perhaps I may say that it was very coherent to those of us who are familiar with the Bill. It covers a large range of issues which we have debated and some which I regret we have been unable to question and challenge more fully.
	As regards the issue concerning Amendments Nos. 17A and 26A, I accept that the Government have come a very long way from the original drafting of the Bill in building in safeguards around all the issues of inquiries and those that go with it. Many of the amendments that the noble and learned Lord has been speaking to do, indeed, introduce safeguards to the whole judicial process. However, what worries me particularly, has worried me from the beginning, still worries me and I should like to see on the face of the Bill, concerns,
	"information the disclosure of which would, or would be likely to, prejudice the prevention or detection of crime or the apprehension or prosecution of offenders."
	That, surely, in any democracy must be a sound reason for not disclosing certain information by a Chief Constable.

On Question, Motion agreed to.

COMMONS AMENDMENT

16 Clause 18, page 11, line 35, after "information", insert "and documents"

Lord Williams of Mostyn: My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 16. I have already spoken to this amendment with Amendment No. 4, as your Lordships recall. I beg to move.
	Moved, That the House do agree with the Commons in their Amendment No. 16.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

17 Page 12, line 3, after "information", insert "is—
	(a) information the disclosure of which would be likely to put an individual in danger, or
	(b) information which"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 17. I have already spoken to this amendment with Amendment No. 4. I believe that now is the brief opportunity for the noble Lord, Lord Glentoran.
	Moved, That the House do agree with the Commons in their Amendment No. 17.—(Lord Williams of Mostyn.)

[Amendment to Commons Amendment No. 17]

17A Line 3, at end insert—
	"(aa) information the disclosure of which would, or would be likely to, prejudice the prevention or detection of crime or the apprehension or prosecution of offenders,"

Lord Glentoran: My Lords, I beg to move Amendment No. 17A as an amendment to Commons Amendment No. 17.
	Moved, That the House do agree with Amendment No. 17A, as an amendment to Commons Amendment No. 17.—(Lord Glentoran.)

Lord Rogan: My Lords, there is no need for me to spend too long reiterating the arguments expressed often in this House and in another place. The Government have yet to provide an acceptable justification for the removal of the fourth ground of appeal—Section 59(3)(d) of the 2000 Act. We are concerned that this will not only undermine the operational capacity of the Chief Constable, but the board's requests could torpedo an expensive and lengthy investigation and could be used as a device to disrupt or defeat ongoing investigation. This amendment therefore simply seeks to reinstate this fourth ground of appeal.
	Amendments Nos. 18 to 21 are concerned with the establishment of a "special purposes committee". The whole concept of the committee is wrong. The committee will be created to handle sensitive information that should not be before the board in the first place. There is concern about confidentiality. We do not want a situation where criminal proceedings could be jeopardised or undermined by the premature disclosure of such information to the board. I therefore support Amendment No. 17A.

Baroness Park of Monmouth: My Lords, I am not perfectly clear. Perhaps we may take a hypothetical case. Supposing that there were present upon the board—as it is evidently hoped that there will be—representatives of Sinn Fein/IRA and there is an ongoing case/investigation/event in which members of that organisation are concerned, would they be, in any way, excluded from participation or would they have to be part of it as members of the committee and, therefore, necessarily, have access which could have serious consequences?

Lord Williams of Mostyn: My Lords, the answer is that they would not automatically be excluded nor would they automatically be included. It would be a matter for the judgment of the board. I take the noble Baroness's point referring to a continuing investigation and it should not be overlooked. However, there is the safeguard that the board and the Chief Constable may agree the timetable. One has got those safeguards. The Chief Constable will have to come to his decision. I hope that if we are setting up a board it will be on the basis that it is capable of being trusted to carry out public functions. We all want, I hope, Sinn Fein to go on to the board—a number of your Lordships have been urging them to do so for some time on the necessary basis that one can only be a member of such a board if committed absolutely to the rule of law and the right of police investigations.
	Therefore, the safeguards are there. I do not gloss over the difficulties. The comfort that I derive is what my honourable friend Jane Kennedy said in another place—namely, that the Chief Constable has been closely involved and has come to the conclusion that he is content. The noble Lord, Lord Glentoran, is right. We have gone a significant way from the moment when the noble Baroness and the noble and learned Lord, Lord Mayhew of Twysden, first raised these issues.

Lord Glentoran: My Lords, I wish to test the opinion of the House on Amendment No. 17A.

On Question, Whether the said amendment (No. 17A), as an amendment to Commons Amendment No. 17, shall be agreed to?
	Their Lordships divided: Contents, 65; Not-Contents, 132.

Resolved in the negative, and amendment disagreed to accordingly.
	On Question, Commons Amendment No. 17 agreed to.

COMMONS AMENDMENTS

18 Page 12, leave out lines 5 to 11.
	19 Page 12, line 12, leave out "or the committee"
	20 Page 12, line 20, leave out "or the committee"
	21 Page 12, line 21, leave out "recipient of the information" and insert "Board"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 18 to 21 en bloc.
	Moved, That the House do agree with the Commons in their Amendments Nos. 18 to 21 en bloc.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

25 Clause 20, page 13, line 7, after "(2),", insert "(2A),"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 25, to which I spoke when introducing Amendment No. 4.
	Moved, That the House do agree with the Commons in their Amendment No. 25.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

26 Page 13, line 15, at end insert—
	"(2A) The circumstances are that—
	(a) the information is supplied by the Chief Constable under section 33A to the Board;
	(b) the Chief Constable informs the Board that, in his opinion, the information is information of a kind mentioned in section 33A(5)(a) or (b)."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 26. I spoke to this amendment when I dealt with Amendments Nos. 4 to 12.
	Moved, That the House do agree with the Commons in their Amendment No. 26.—(Lord Williams of Mostyn.)

[Amendment No. 26A not moved.]
	On Question, Motion agreed to.

COMMONS AMENDMENTS

27 Page 13, line 18, leave out "33A or"
	28 Page 13, line 18, leave out from second "or" to end of line 19 and insert "a special purposes committee;"
	29 Page 13, line 20, leave out from "committee" to "that" in line 21.
	30 Page 13, line 22, leave out "section 33A(5)(a) or (b) or"
	31 Page 13, line 26, after "section 60" insert "or by a person who is assisting or has assisted in the conduct of such an inquiry"
	32 Page 13, line 26, leave out from "to" to end of line 27 and insert "a special purposes committee;"
	33 Page 13, line 32, leave out from "is" to "except" in line 33 and insert "assisting or has assisted in the conduct of the inquiry"
	34 Page 13, line 34, leave out "member of the staff of the Board" and insert "person"
	35 Page 13, line 38, leave out from "Ombudsman" to end of line 39 and insert ", or an officer of the Ombudsman, in connection with any function of the Ombudsman;"
	36 Page 13, line 40, leave out from "to" to end of line 41 and insert "a special purposes committee;"
	37 Page 14, line 4, at end insert "(2A),"
	38 Page 14, line 10, leave out from "to" to "to" in line 11 and insert "a special purposes committee,"
	39 Page 14, line 16, leave out from "Ombudsman" to end of line 17 and insert ", or an officer of the Ombudsman, in connection with any function of the Ombudsman;"
	40 Page 14, line 31, after "Schedule 1", insert "; and
	"officer of the Ombudsman" has the meaning given by section 50(1) of the 1998 Act"
	41 Page 14, line 31, at end insert—
	"(9) In section 59(5) of the Police (Northern Ireland) Act 2000 (c.32) at the beginning insert "Subject to section 74A(6)"."
	42 Clause 21, page 14, line 36, leave out "and (1B)" and insert "to (1E)"
	43 Page 14, leave out lines 38 to 45 and insert—
	""(1A) The Board shall constitute a committee of its members for the purposes mentioned in sub-paragraph (1B) if—
	(a) the Chief Constable informs the Board that he wishes to supply information to a committee of the Board under section 59(4D),
	(b) the Secretary of State informs the Board that he proposes to modify a requirement to submit a report under section 59(1) for the purpose mentioned in section 59(4A)(b), or
	(c) a person who is conducting or has conducted an inquiry under section 60, or who is assisting or has assisted in the conduct of such an inquiry, informs the Board that he wishes to disclose information to a committee of the Board under section 74A(5).
	(1B) The purposes are—
	(a) handling information supplied to the committee by the Chief Constable under section 59;
	(b) handling information supplied to it by a person who is conducting or has conducted an inquiry under section 60 or by a person who is assisting or has assisted in the conduct of such an inquiry.
	(1C) The Board may not constitute a committee of its members for the purposes mentioned in sub-paragraph (1B) if a committee of its members has already been constituted for those purposes under sub-paragraph (1) or (1A).
	(1D) A committee constituted under sub-paragraph (1) or (1A) for the purposes mentioned in sub-paragraph (1B) shall consist of 7 members of the Board.
	(1E) The members of a committee constituted under sub-paragraph (1) or (1A) for the purposes mentioned in sub-paragraph (1B)—"
	44 Page 15, line 3, at end insert—
	"(4) In section 77(1) of the Police (Northern Ireland) Act 2000 (interpretation) at the appropriate place insert—
	""special purposes committee" means a committee constituted by the Board under paragraph 24(1) or (1A) of Schedule 1 for the purposes mentioned in paragraph 24(1B) of that Schedule;"."

Lord Williams of Mostyn: My Lords, with your Lordships' leave, I beg to move that the House do agree with the Commons in their Amendments Nos. 27 to 44 en bloc. I spoke to these amendments when dealing with Amendment No. 4.
	Moved, That the House do agree with the Commons in their Amendments Nos. 27 to 44 en bloc.

On Question, Motion agreed to.

COMMONS AMENDMENT

22 After Clause 18, insert the following new clause—
	"APPOINTMENT OF CONSTABLES WITH SPECIAL POLICING SKILLS
	(1) The Police (Northern Ireland) Act 2000 (c.32) is amended as set out in subsections (2) to (5).
	(2) In section 36 (appointments to the Police Service of Northern Ireland) after subsection (3) (training requirements for persons appointed to rank of constable) insert—
	"(4) Subsection (3) does not apply to a person appointed in pursuance of an authorisation under section 47A(1)."
	(3) After section 47 insert—
	"47A APPOINTMENTS TO POLICE SERVICE OF NORTHERN IRELAND IN SPECIAL CIRCUMSTANCES
	(1) The Board may if requested to do so by the Chief Constable authorise the appointment to the rank of constable in the Police Service of Northern Ireland of a specified number of persons—
	(a) who have a specified policing skill, but
	(b) who have not complied with the requirements in paragraphs (a) and (b) of section 36(3).
	(2) The Board shall not give an authorisation under subsection (1) in relation to persons who have a particular policing skill unless it is satisfied—
	(a) that the requirements of subsection (3) are met;
	(b) that any further requirements which are specified by it under subsection (4) and which apply in relation to the giving of the authorisation are met.
	(3) The requirements are—
	(a) that there is a need for more persons who have the policing skill to be appointed to the rank of constable in the Police Service of Northern Ireland;
	(b) that the need cannot be met by the appointment of persons who have complied with the requirements in paragraphs (a) and (b) of section 36(3).
	(4) The Board may specify further requirements which apply in relation to the giving of an authorisation under subsection (1).
	(5) Any requirements specified under subsection (4) may apply in relation to the giving of all authorisations under subsection (1) or to the giving of a particular authorisation or description of authorisation.
	(6) In this section "specified" means specified by the Board."
	(4) In paragraph 17(4) of Schedule 1 (procedure for Board decisions) for "paragraph 18" substitute "paragraphs 17A and 18".
	(5) After paragraph 17 of Schedule 1 insert—
	"Authorisations under section 47A(1)
	17A The Board shall not give an authorisation under section 47A(1) unless a proposal to do so has been approved by each member of the Board present and voting on the question at a meeting of the Board."
	(6) The preceding provisions of this section expire at the end of a period of two years starting on the day on which this Act is passed.
	(7) The Secretary of State may by order amend subsection (6) by substituting "four years" for "two years".
	(8) An order under subsection (7) may be made only with the prior authorisation of the Board.
	(9) The Board shall not give an authorisation under subsection (8) unless a proposal to do so has been approved by each member of the Board present and voting on the question at a meeting of the Board.
	(10) In paragraph 17(4) of Schedule 1 to the Police (Northern Ireland) Act 2000 (c.32) (procedure for Board decisions) after "18" insert "and section (Appointment of constables with special policing skills)(9) of the Police (Northern Ireland) Act 2003".
	(11) An order under subsection (7) may not be made after the end of the period of two years specified in subsection (6)."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 22.
	The amendment provides for a limited exception to the 50:50 recruitment arrangements. The Chief Constable will therefore be able to address the current shortage of experienced officers with special policing skills at the rank of constable. A number of your Lordships have raised this question. The amendment was put forward by the Policing Board, with the unanimous support of its members. I welcome the fact that they have responded so constructively. It is a great credit to the board members that they are working in such a way, so co-operatively, that they came to unanimous agreement on such a sensitive issue.
	The provision will allow the Chief Constable to bring into the police service a specified number of officers with specialist policing skills where he can demonstrate that there is a significant shortfall—for instance, detectives. He can use it only when certain criteria established by the board have been met, and where the board members unanimously approve its use.
	These exceptional arrangements will be available for two years, starting from Royal Assent. The Secretary of State may extend the life of the provision on one occasion only, to allow it to operate for a maximum period in all of four years. Such an extension would require the unanimous agreement of the Board.
	This route of entry will be very much the exception. We see it as a temporary measure to plug the skills gap, about which a number of your Lordships were concerned, created largely as a consequence of the severance scheme. It is in no sense a watering down of, or fundamental departure from, the 50:50 requirement.
	I commend the amendment.
	Amendment No. 22C would enable the measures to be activated with the approval of a majority of the Policing Board. The board has shown great maturity on this and earlier occasions—for example, on symbols—and I am sure that it will do so in the future. The detail of this exceptional mechanism has been the subject of lengthy and painstaking consideration by the board, which of course includes representatives of the Ulster Unionist Party, and it has expressly requested that its unanimity be a precondition for the mechanism's use. We are eager to honour the board's wishes in this regard, and I therefore invite the noble Lords concerned not to press the amendment.
	Amendments Nos. 22A, 22B and 22D, taken together, would require the Secretary of State, if asked by a majority of the board, to make an order suspending the 50:50 provisions. Given the strength of support for Amendment No. 22, both here and in the other place, I very much hope that their Lordships will be prepared to withdraw these amendments. We discussed this matter at length earlier. It would be much too radical a departure from 50:50, which is the cornerstone of our policy.
	Moved, That the House do agree with the Commons in their Amendment No. 22.—(Lord Williams of Mostyn.)

AS AMENDMENTS TO COMMONS AMENDMENT NO. 22

22A Line 39, at end insert—
	"47B APPOINTMENTS TO POLICE SERVICE OF NORTHERN IRELAND
	(1) In the event that—
	(a) the Chief Constable is unable to appoint his required number of police trainees or police support staff, or
	(b) the number of serving officers is below that intended at the time of consideration,
	the Secretary of State shall, at the request of the police board and acting on the recommendation of the Chief Constable, make an order to suspend the provisions of section 46 of the Police (Northern Ireland) Act 2000 for a period of six months."
	22B Line 41, after "17A" insert ", 17B"
	22C Line 45, leave out "each member" and insert "a majority"
	22D Line 47, at end insert—
	"Recommendations under section 47B(1)
	17B The Board shall not give an authorisation under section 47B(1) unless a proposal to make a request has been approved by a majority of the Board present and voting on the question at a meeting of the Board."

Lord Rogan: My Lords, I beg to move, as amendments to Commons Amendment No. 22, Amendments Nos. 22A to 22D.
	It is not my intention to detain the House unnecessarily. Noble Lords will be well aware of our objections to the discriminatory recruitment policy for the Police Service of Northern Ireland.
	I am reminded of words I used during the Report stage of consideration of the Bill: 50:50 has created a Catch 22 situation. Aware that the discriminatory recruitment policy has not worked—the Police Service of Northern Ireland is struggling to attract the number of recruits required to police Northern Ireland effectively—the Government have given themselves several get-out clauses. In the words of my party colleague in another place, Lady Hermon, the Government clearly want to have their cake and eat it. By allowing the Chief Constable to recruit constables with specified skills outside the 50:50 recruitment policy, the Government are prolonging the period for which discrimination will be applied.
	The principle of equality of opportunity is central to the Belfast agreement. Policing should not be regarded as an exception; 50:50 recruitment denies equality of opportunity—it is nothing short of discrimination. It is a great source of grievance for a very large number of people across Northern Ireland. We in the Ulster Unionist Party have always been consistent in our opposition to 50:50 recruitment.
	Amendments Nos. 22A, 22B, 22C and 22D provide that, at the request of a majority of the Policing Board, when the Chief Constable has a shortfall in recruits the provisions of Section 46-50:50—could be suspended for six months. It seems to me that while not ideal—we would very much welcome the complete withdrawal of Section 46—this is an extremely sensible amendment, designed to assist the Chief Constable to police Northern Ireland effectively and efficiently.
	We were pleased to note that both Conservative and Liberal Democrat Members of Parliament in another place joined my party colleagues in the Lobbies last week on a similar amendment. I hope that I can enjoy the same privilege.
	Moved, as amendments to Commons Amendment No. 22, Amendments Nos. 22A to 22D .—(Lord Rogan.)

On Question, Whether the said amendments shall be agreed to?
	Their Lordships divided: Contents, 63; Not-Contents, 118.

Resolved in the negative, and Motion disagreed to accordingly.
	On Question, Commons Amendment No. 22 agreed to.

COMMONS AMENDMENT

23 After Clause 19, insert the following new clause—
	"MEMBERS OF PSNI ENGAGED ON OTHER POLICE SERVICE
	In section 27 of the Police (Northern Ireland) Act 1998 (c.32) (members of Police Service of Northern Ireland engaged on other police service) after subsection (6) insert—
	"(6A) Regulations made by virtue of section 25(3) or (4) in relation to a member of the PSNI who has completed a period of relevant service within subsection (1)(d) may provide for a relevant procedure to be treated for the purposes of the regulations as carried out in accordance with procedures for which provision is made by regulations made by virtue of section 25(3).
	(6B) In subsection (6A) "relevant procedure" means an investigation, hearing or other procedure carried out in relation to the person concerned in a country or territory outside the United Kingdom in connection with the person's relevant service.""

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 23.
	Clause 19 allows the Chief Constable to make fixed-term appointments to the PSNI. The Chief Constable, if he requires special expertise, is entitled to procure it in that way, including from members of the Garda in the Irish Republic. Such secondments could also take place in the other direction. The Irish Government will shortly be bringing forward a Bill to allow secondments of policing powers from PSNI to the Garda.
	The secondment of PSNI officers to the Garda will take place under Section 8 of the Police (Northern Ireland) Act 2000. It deals with the provision by the board of advice and assistance to international organisations such as the United Nations and other police services. Section 27 of the Police (Northern Ireland) Act 1998 sets out some of the key principles.
	One key principle deals with discipline. Normally, where a member of the PSNI is seconded under Section 8, he may be dealt with under the PSNI's own conduct regulations for any breach of discipline as if that breach had been committed during service with the PSNI. The amendment allows the Secretary of State to modify the relevant regulations in respect of disciplinary matters to enable investigations and hearings held in a country outside the United Kingdom to be taken into account by the PSNI in its own disciplinary proceedings.
	Clearly, the imposition of sanctions could have a significant effect on an officer's career and it is right that the choice of penalty should be, and remain, the responsibility of the home service. In practical terms it makes more sense for the host service to carry out the investigation and hearing as this would take place in the jurisdiction in which the alleged offence would have occurred. These arrangements will be reciprocal. Any PSNI officer will be subject to the code of ethics and he would fall within the remit of the Police Ombudsman if a complaint were made.
	We expect to have very little, if any, recourse to such regulations. Any member of the PNSI who was seconded anywhere in the world would be an ambassador for his service, but we need to provide for these eventualities.
	Moved, That the House do agree with the Commons in their Amendment No. 23.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

24 Insert the following new clause—
	"PROTECTED DISCLOSURES BY POLICE OFFICERS
	(1) After Article 67K of the Employment Rights (Northern Ireland) Order 1996 (S.I. 1996/1919 (N.I.16) insert—
	"67KA APPLICATION OF PART VA AND RELATED PROVISIONS TO POLICE
	(1) Paragraph (2) applies for the purposes of—
	(a) this Part,
	(b) Article 70B and Articles 71 and 72 so far as relating to that Article, and
	(c) Article 134A and the other provisions of Part XI so far as they relate to the right not to be unfairly dismissed in a case where the dismissal is unfair by virtue of Article 134A.
	(2) A person who holds, otherwise than under a contract of employment, the office of constable shall be treated as an employee employed by the relevant officer under a contract of employment; and any reference to a worker being "employed" and to his "employer" shall be construed accordingly.
	(3) In this Article "the relevant officer"—
	(a) in relation to a police officer, means the Chief Constable;
	(b) in relation to a person holding office under section 9(1)(b) of the Police Act 1997 (police members of the National Criminal Intelligence Service) means the Director General of the National Criminal Intelligence Service; and
	(c) in relation to any other person holding the office of constable, means the person who has the direction and control of the body of constables in question."
	(2) In Article 243(1) of that Order (provisions which do not apply to persons engaged in police service under a contract of employment)—
	(a) omit the words "Part VA,";
	(b) after "Articles 132" insert ", 134A";
	(c) after "Article 132" insert "or 134A".
	(3) Article 16 of the Public Interest Disclosure (Northern Ireland) Order 1998 (S.I. 1998/1763 (N.I. 17)) (exclusion of police service from provisions about protected disclosures) shall cease to have effect.
	(4) Subsections (1) to (3) come into force in accordance with provision made by the Secretary of State by order."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 24.
	The amendment deals with protected disclosures by police officers. The purpose of this new clause, with consequential amendments revoking provisions in the Employment Rights (Northern Ireland) Order 1996 and the Public Interest Disclosure (Northern Ireland) Order 1998 in Schedule 3 is to afford protection to police officers who make protected disclosures. The clause has the support of the Chief Constable and the ombudsman.
	A "protected disclosure" includes disclosures that a criminal offence has been committed; that a person has failed to comply with a legal obligation; or that there has been a miscarriage of justice.
	The purpose of these changes is to ensure that PSNI officers, reserve officers and others holding the office of constable, such as the Harbour Police and the NCIS, will be able to report wrongdoing by other officers with the assurance of the full protection of the law if they are discriminated against. Amendments Nos. 50, 54, 55 and 57 are consequential. I commend the amendments to the House.
	Moved, That the House do agree with the Commons in their Amendment No. 24.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

45 Clause 28, page 19, line 19, leave out from beginning to "accordingly" in line 22 and insert "members of the police support staff—
	(a) a member of the police support staff must be treated as an employee of the Chief Constable in relation to conduct in reliance or purported reliance on a designation under section 23;
	(b) conduct by a member of the police support staff in reliance or purported reliance on a designation under section 23 must be taken to be conduct in the course of that employment;
	(c) in the case of a tort, the Chief Constable".
	46page 19, line 23, leave out subsection (2).
	47 Clause 36, page 22, line 18, leave out paragraph (a).

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 45 to 47.
	Clause 28 was added to the Bill by government amendment during our Report stage. It makes provision for the purpose of determining liability for unlawful conduct in the case of conduct by a designated person in purported reliance on that designation.
	It was decided in another place that the provision should be refined. At that time the clause provided for the Policing Board to be treated as a joint tortfeasor in the case of action by board employees in reliance on a designation and for the Department of Finance and Personnel to be the joint tortfeasor in the case of civil servants. The preferred position is for the Chief Constable to be responsible as the support staff are under his direction and control. Amendments Nos. 45 and 46 reflect that refinement.
	As to Amendment No. 47, at present Clause 36 amends Article 66 of the PACE (Northern Ireland) Order 1989 on codes of practice to allow that the Secretary of State may provide by order for a code of practice to have effect with modifications, although these must be confined to one or more of the following: the effect of the code in relation to an area of Northern Ireland specified in the order; the effect of the code in relation to a period not exceeding two years specified in the order; and the effect of the code in relation to offences or descriptions of offenders specified in the order.
	The purpose of the amendment is to remove the possibility of a code of practice being modified under Article 66(6A) so as to apply within a particular area of Northern Ireland. Of course, there is only one police service in Northern Ireland and therefore there is no necessity to stipulate a geographic area.
	Amendment No. 53 concerns Schedule 1, which relates to the provisions in Clauses 23 and 24 dealing with the exercise of police powers by designated police support staff and contracted-out staff. The powers are similar to those that have been made available in England and Wales for designated civilians through the Police Reform Act 2002. These provisions were brought forward at the express request of the Chief Constable and with the support of the board.
	Part 1 of the schedule includes a range of powers which may be needed to support the work of civilian investigating officers in specialist areas. It covers powers to enter and search premises following arrest, which are particularly relevant to the work of scenes of crimes officers, many of whom are now civilians.
	Part 2 covers powers that may be exercised by detention officers at police stations. Part 3 covers escort powers. Part 4 defines the meanings of certain terms used in Schedule 1.
	The purpose of the specific amendment is to extend standard safeguards to warrants dealt with by designated persons in gaining access to excluded and special procedure material. I commend the amendments to the House.
	Moved, That the House do agree with the Commons in their Amendments Nos. 45 to 47.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

53 Schedule 1, page 25, line 37, at end insert—
	"(ba) Article 17 of that Order (safeguards) has effect in relation to the issue of a warrant under paragraph 9 of Schedule 1 to that Order to the designated person as it has effect in relation to the issue of a warrant under that paragraph to a constable;
	(bb) Article 18 of that Order (execution of warrants) has effect in relation to a warrant issued under paragraph 9 of Schedule 1 to that Order (whether to the designated person or to any other person) as if references in that Article to a constable included references to the designated person;"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 53. I have spoken to this amendment.
	Moved, That the House do agree with the Commons in their Amendment No. 53.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

1 Clause 1, page 1, line 12, after "Constable", insert—
	"(aa) the Ombudsman;
	(ab) the Northern Ireland Human Rights Commission;
	(ac) the Equality Commission for Northern Ireland;"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 1.
	Amendment No. 3, along with Clauses 1, 2 and 17, deals with the balancing of the tripartite policing relationship between the Policing Board, the Chief Constable and the Secretary of State. In effect, Amendments Nos. 1, 2 and 3 make two changes. Primarily, they require the Secretary of State to carry out wider consultation before determining or revising codes of practice or long-term policing objectives. At the moment he has to consult with the board with a view to obtaining its agreement and with the Chief Constable and such others as he thinks appropriate regarding any proposed code of practice or long-term policing objectives. Under the amendments proposed, these consultation processes would be expanded, making it a statutory requirement that the Secretary of State should also consult with the Police Ombudsman, the Northern Ireland Human Rights Commission and the Equality Commission for Northern Ireland.
	The proposed arrangements do not upset the existing balance. Rather they recognise the valuable contribution and input that the tripartite policing relationship brings about. They simply require the Secretary of State to consult more widely.
	The amendments separate out the consultation arrangements for issuing and revising codes of practice from those dealing with setting and revising long-term objectives. Codes of practice are now dealt with under the new clause proposed by Amendment No. 3, while Clause 1 now deals specifically with the consultation arrangements for long-term policing objectives. Amendment No. 2 is a consequential amendment enabling this separation to be made.
	Were the noble Lord, Lord Glentoran, to be in any lingering doubt, I ask him not to move Amendment No. 1A.
	Moved, That the House do agree with the Commons in their Amendment No. 1.—(Lord Williams of Mostyn.)

[Amendment No. 1A not moved.]
	On Question, Amendment No. 1 agreed to.

COMMONS AMENDMENT

2 Clause 1, page 1, line 15, leave out subsection (2).

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 2. I spoke to this amendment when dealing with Amendment No. 1.
	Moved, That the House do agree with the Commons in their Amendment No. 2.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

3 After Clause 1, insert the following new clause—
	"CODES OF PRACTICE
	In section 27 of the Police (Northern Ireland) Act 2000 (c.32) (codes of practice on exercise of functions) for subsection (2) substitute—
	"(2) Before issuing or revising a code of practice under this section, the Secretary of State shall consult the Board with a view to obtaining its agreement to the proposed code of practice or revision.
	(2A) Before issuing or revising a code of practice under this section, the Secretary of State shall also consult—
	(a) the Chief Constable;
	(b) the Ombudsman;
	(c) the Northern Ireland Human Rights Commission;
	(d) the Equality Commission for Northern Ireland; and
	(e) such other persons as the Secretary of State considers appropriate.""

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 3. I spoke to this amendment when dealing with Amendment No. 1.
	Moved, That the House do agree with the Commons in their Amendment No. 3.—(Lord Williams of Mostyn.)

[Amendments Nos. 3A to 3C not moved.]
	On Question, Amendment No. 3 agreed to.

COMMONS AMENDMENT

48 Clause 37, page 22, line 33, at end insert—
	"(2A) No order may be made under section (Independent members: declaration against terrorism)(6), (Independent members: disqualification)(2) or (Belfast)(2) unless a draft of the statutory rule containing the order to be made has been laid before Parliament and approved by a resolution of each House."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 48. I spoke to this amendment when dealing with Amendment No. 13.
	Moved, That the House do agree with the Commons in their Amendment No. 48.—(Lord Williams of Mostyn.)

AS AN AMENDMENT TO COMMONS AMENDMENT NO. 48

48ZALine 3, leave out "or (Belfast) (2)" and insert ",(Belfast)(2) or (Appointment of constables with special policing skills)(7)"

Lord Williams of Mostyn: My Lords, I beg to move manuscript Amendment No. 48ZA as an amendment to Commons Amendment No. 48. I spoke to this amendment when dealing with Amendment No. 13.
	Moved, That Amendment No. 48ZA, as an Amendment to Commons Amendment No. 48, be agreed to.—(Lord Williams of Mostyn.)

Lord Rogan: My Lords, I think I understood the Lord Privy Seal to say on two occasions that matters would be brought back to this House before enactment. Will he confirm that orders will be laid before Parliament only after acts of completion?

Lord Williams of Mostyn: My Lords, yes.

On Question, Amendment No.48ZA agreed to.

AS AN AMENDMENT TO COMMONS AMENDMENT No.48

48A Line 5, at end insert—
	"(2B) No order may be made under section (Independent members: disqualification)(2) or (Belfast)(2) at any time when section 1 of the Northern Ireland Act 2000 (c. 1) (suspension of devolved government) is in force."

Lord Smith of Clifton: My Lords, I beg to move Amendment No. 48A as an amendment to Commons Amendment No. 48. I spoke to this amendment with Amendment No. 13.
	Moved, That Amendment No. 48A, as an amendment to Commons Amendment No. 48, be agreed to.—(Lord Smith of Clifton.)

On Question, Motion agreed to.
	On Question, Commons Amendment No. 48, as amended, agreed to.

COMMONS AMENDMENT

49 Page 22, line 35, after "section", insert "(Independent members: declaration against terrorism)(6), (Independent members: disqualification)(2), (Belfast)(2), (Protected disclosures by police officers)(4),"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 49. I spoke to this amendment with Amendment No. 13.
	Moved, That, the House do agree with the Commons in their Amendment No. 49.—(Lord Williams of Mostyn.)

AS AN AMENDMENT TO COMMONS AMENDMENT No.49

49A Line 2, after "(Belfast)(2)," insert "(Appointment of constables with special policing skills)(7),"

Lord Williams of Mostyn: My Lords, I beg to move Amendment No. 49A as an amendment to Commons Amendment No. 49. I spoke to this with Amendment No. 13.
	Moved, That Amendment No. 49A, as an amendment to Commons Amendment No. 49, be agreed to.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.
	On Question, Commons Amendment No. 49, as amended, agreed to.

COMMONS AMENDMENT

50 Clause 38, page 22, line 40, after "repeals", insert "and revocations"

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 50, to which I spoke with Amendments Nos. 13 and 24.
	Moved, That, the House do agree with the Commons in their Amendment No. 50.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

51 Clause 40, page 23, line 5, leave out subsection (2).

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 51.
	Amendment No. 51, as your Lordships will have readily detected, deletes the privilege amendment introduced in this House on Third Reading.
	Moved, That, the House do agree with the Commons in their Amendment No. 51.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

COMMONS AMENDMENT

54 Schedule 3, page 34, line 29, at beginning insert—
	
		
			 "Employment Rights (Northern Ireland) Order 1996 (S.I. 1996/1919 (N.I. 16)) In Article 243(1), the words "Part VA,"." 
		
	
	55 Page 34, line 30, at end insert—
	
		
			 "Public Interest Disclosure (Northern Ireland) Order 1998 (S.I. 1998/1763 (N.I. 17)) Article 16." 
		
	
	56 Page 34, line 37, after "Schedule 1," insert "in paragraph 3(7)(b), the word "or" immediately preceding sub-paragraph (iii), in paragraph 10(1)(b), the word "or" immediately preceding sub-paragraph (iii) and"
	57 Page 34, line 39, at end insert—
	"2 The revocations in the Employment Rights (Northern Ireland) Order 1996 and the Public Interest Disclosure (Northern Ireland) Order 1998 have effect in accordance with section (Protected disclosures by police officers)(4) above."

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 54 to 57 en bloc, to which I spoke with Amendments Nos. 15 and 24.
	Moved, That, the House do agree with the Commons in their Amendments Nos. 54 to 57 en bloc.—(Lord Williams of Mostyn.)

On Question, Motion agreed to.

Criminal Justice (Northern Ireland) Order 2003

Lord Williams of Mostyn: rose to move, That the draft order laid before the House on 24th March be approved.

Lord Williams of Mostyn: My Lords, we conducted a cross-cutting review of the criminal justice system in 1997. Eighteen proposals for reducing delay and improving service delivery in the criminal system in Northern Ireland came about. Most of those have been taken forward.
	In a sense, the order is a portmanteau of provisions which will, individually and collectively, improve the workings of the criminal justice system in Northern Ireland. They relate to arrangements for bail, time limits for the initial stages of proceedings, the law on sexual offences, public order and some less important issues.
	There has been wide consultation. The draft order was laid before the House on 19th December for consultation; responses received were generally supportive.
	The proposals on bail mirror to a large extent existing law in England and Wales, and bring certain aspects of Northern Ireland's bail processes into line with those in England and Wales. They will ensure that bail serves its purpose of allowing those accused of offences to be free of custody while at the same time ensuring that they turn up for trial, do not commit other offences and do not interfere with witnesses. There will therefore be a new offence of absconding on bail; new powers for the police to arrest without warrant those who are unlikely to surrender to custody or who break their bail conditions; and to set conditions on the grant of bail. Finally, the courts' discretion as to whether recognizances should be forfeited or not will be removed. This will help to ensure that people released on bail turn up at court or a police station as required.
	On time limits, we wish to reduce the amount of time it takes for cases to pass through the formal criminal justice system. Statutory regulations have been in place in England and Wales since 1987. Targets were introduced in Northern Ireland; we think we should take legislative provision to establish time limits. We need to strike a balance between the timely disposal of cases and the need to allow proper time for the development of cases. We are also aware of the potential risks if people held in custody awaiting trial are released virtually automatically.
	There are no immediate plans to introduce time limits, but we will have further consultation about the precise nature and scope of any time limits before any regulations are made.
	On sexual offences, there are four main changes. Article 18 amends the law on rape with the effect that men and boys may be the victims of rape. Article 19 brings the law on heterosexual anal intercourse into line with that on homosexual activity by decriminalising such behaviour in private between any persons of or over the age of consent. Article 22 increases the penalty for indecent conduct against a child from two to 10 years' imprisonment. Article 23 abolishes the presumption that a boy under 14 is incapable of sexual intercourse. This is a fair framework for the prosecution of criminal offences.
	The order also includes a number of miscellaneous provisions. I draw your Lordships' specific attention to riotous behaviour. The maximum penalty at the moment is six months on summary conviction. I think most people think that that is not sufficient. Riotous behaviour is not an arrestable offence. This makes police activity very difficult in riotous situations. We therefore propose an increase in the maximum penalty to one year and to make the offence arrestable.
	There are other changes: for instance, amending summonses; pleas of guilty in the magistrates' court where the accused does not appear; lengthening the period of remand; and allowing the use of live television links, which has been successfully piloted in England.
	I am confident that we are introducing arrangements compatible with the Human Rights Act. I beg to move.

Moved, That the draft order laid before the House on 24th March be approved.—(Lord Williams of Mostyn.)

Lord Glentoran: My Lords, I was fortunate enough to have a very thorough briefing from Northern Ireland Office officials on this order. Although the noble and learned Lord has given us a very thorough outline of the key issues, it is another order of considerable size. I know that my colleagues in another place were concerned that they did not have sufficient time to debate these issues. However, from these Benches, I assure the noble and learned Lord that I have challenged the officials on all the pertinent issues, which I believe are all sensible and for the betterment of the people of Ulster.

Lord Smith of Clifton: My Lords, on these Benches, we welcome the order wholeheartedly, particularly the provisions on riotous behaviour.

On Question, Motion agreed to.

Local Government Bill

Lord Rooker: My Lords, I beg to move that this Bill be now read a second time.
	The main purpose of the Local Government Bill is to deliver those measures in the White Paper Strong Local Leadership—Quality Public Services which require primary legislation. This is of critical importance to local authorities; we are seeking to establish a new partnership between central and local government.
	The Bill paves the way for a new form of localism where councils will be given substantial new freedoms to help them improve services. The removal of red tape and unnecessary bureaucracy will allow them to focus their efforts on those things which improve effective service delivery. Other provisions in the Bill will help councils to be more responsive to local needs and pressures and, indeed, to promote closer working between councils and other partners, including local business.
	There has been substantial consultation on the contents of the Bill. It deals with various aspects of local government finance. The proposals in this respect were first set out in Modernising Local Government Finance: a Green Paper published in September 2000. These were then amended and further developed in the light of the many consultation responses we received and the outcome was set out in the White Paper.
	We then published a draft Bill for consultation. This was considered by a Select Committee of the other House and attracted over 300 responses from local government and other stakeholders. In the light of those responses we made further changes to the content.
	Apart from the formal consultation processes, we have also been keen to involve key stakeholders in the detailed development of our proposals. For instance, the detailed work on developing and preparing for the implementation of the new prudential system—which I shall discuss in a moment—in Part 1 of the Bill is being taken forward by a joint working group drawn from central and local government, CIPFA and the Audit Commission. Similarly the arrangements and draft guidance for Business Improvement Districts have been and will continue to be developed in consultation with the local government associations, the CBI and other organisations who represent business, and with town centre management bodies and rating professionals.
	I refer at this point to the report published today of the Delegated Powers and Regulatory Reform Committee of your Lordships' House. It has reported on the Bill. I welcome the report and the committee's recognition that the complexity of the Bill is a necessary consequence of dealing with local government finance. We shall, of course, look very carefully at the committee's recommendations. We shall make a serious attempt to accommodate the recommendations in the Bill in due course.
	I turn now to the main provisions of the Bill. Most of the content covers both England and Wales. The Welsh Assembly Government support the Bill and have welcomed its introduction.
	I shall now seek to devote no more than two or three sentences to each of the eight parts of the Bill. Part 1 concerns capital finance and provides a new framework for local government capital investment. Authorities will have greater freedom to raise finance to buy, build and improve all kinds of property and infrastructure. The long-standing requirement for government borrowing consent will be swept away. Authorities will have power to borrow without government approval if it is prudent to do so. They will simply have to satisfy themselves that they can pay the debt out of their own revenues. There are reserve powers for government to step in, but in the light of consultation, the use of these has been circumscribed so that they can be used only in pre-defined circumstances. The new prudential system is a very substantial freedom, which will be available to all authorities, and local government wants to see the Bill enacted in time for the new system to take effect from the new financial year in April 2004, rather than that which is just about to commence.
	Part 2 relates to financial management. The delivery of high quality public services depends on sound financial management. Good authorities already have effective processes in place to manage and monitor their budgets effectively and have adequate provision to deal with unexpected circumstances. Part 2 will enshrine in law some basic processes of sound budgetary management. That will ensure that authorities which experience problems can be assisted.
	Part 3 refers to grants. Various mechanisms to make grants are provided for in Part 3. These include a wide-ranging power to give greater flexibility in making grants to local authorities for any purpose. This new power will allow government to pay grants without imposing undue conditions, thereby allowing more grants to be delivered as unring-fenced funding. That does not give Ministers carte blanche to pay out what they want. Ministers can allocate grants only where they have the authority of Parliament to do so.
	Part 4 concerns business improvement districts. I reluctantly use the acronym BIDs although I shall try to avoid using jargon. Part 4 will legislate for business improvement districts. BIDs are partnership arrangements through which local business communities and local authorities can take forward schemes which will benefit the local community, subject to the agreement of ratepayers. Projects could involve additional services such as improvements to the quality of the local environment, measures to remove graffiti more quickly or improvements to parks and open spaces among others. There are already good examples of councils and businesses working together to deliver benefits for their areas. Voluntary regeneration and town centre management schemes are thriving and these will provide a strong basis for the new BID schemes to develop once the legislation is in place.
	Part 5 concerns business rates. There are various measures in Part 5 that will change the non-domestic rating system. For example, small business rate relief will benefit small firms occupying single premises with a rateable value of under £8,000. This will significantly reduce the overheads of those businesses.
	Another provision in Part 5 will enable the Secretary of State to put in place a scheme to allow local retention of an element of non-domestic rates. This will provide a financial incentive for local authorities and business to work in partnership to maximise local economic growth and regeneration.
	Part 6 relates to council tax. Part 6 will update council tax—that is not a euphemism—to ensure that local people contribute a fair share towards local public services. A fixed 10-year cycle of revaluation and varying the number of bands will help to do this. I ought to make clear that the Bill does not include any provision for regional council tax banding. That is not necessary as that provision is already included in the Local Government Finance Act 1992. I must make it absolutely clear that we have no plans to use the power in the 1992 Act.
	Under Part 6 local authorities will have very wide discretion to grant discounts and exemptions from council tax where they consider this appropriate. Authorities will thus be free to take decisions locally in ways that best reflect the needs and circumstances of their local communities.
	Part 7 is a short part dealing with housing finance. In 1999 we announced the introduction of resource accounting into the Housing Revenue Account (HRA). Part 7 of the Bill completes this, as well as removing a perceived obstacle to our social rent reforms.
	We are also placing local housing strategies on a statutory footing and giving authorities the freedom to streamline their housing-related plans into a single document.
	Finally, Part 8—I am aware that there are nine parts, but the final one does not count as it comprises a technical issue—deals with non-financial provisions. Some people think that local government finance is a wonderful thing but usually their eyes glaze over as they say that. This is only the Second Reading of the Bill and not the time to go into detail in that regard. Some of my colleagues in another place believe that local government finance is the reason for their existence. That does not apply to me, which is why Part 8 is such a joy to behold. Part 8 contains the non-finance provisions and also gives substantial freedoms to local authorities. I shall touch on just a few examples.
	Innovation will be encouraged through the power for all best value authorities to charge for discretionary services. Better-performing councils will be empowered to trade across the services they can provide. An express power will be created to give local authorities the freedom to hold advisory polls on the well-being of their communities and any matter relating to the services for which they are responsible. Councils will be allowed to retain proceeds from litter and dog-fouling penalties and spend these on local environmental improvements, and high performers will be able to use the income for any purpose.
	Part 8 also includes a provision to repeal Section 19 of the Fire Services Act 1947. The Bill will remove the requirement for fire authorities to seek approval of the Secretary of State before making any reduction, no matter how minor or trivial, in the number of firefighting posts or appliances or before the closure of fire stations. The Bill is about extending freedoms and flexibilities to local authorities, and we believe that in a modern fire service it is not appropriate for the Secretary of State to take these decisions. They are much better taken at local level. I deviate dangerously now. The only fire station that closed in my former constituency was replaced by the first community fire station in the country but it still had to go through the ridiculous process that I mentioned.
	Part 8 also deals with what is known as Section 28. During consideration of the Bill in another place, an amendment was made to repeal Section 2A of the Local Government Act 1986, more commonly known as Section 28 because the provision was implemented by Section 28 of the Local Government Act 1988. Those noble Lords who have done their homework will be aware of this, but I have to warn the House that I do not go along with the folklore related to the matter. I say that because I was present on the night that the section was put into the 1988 Local Government Bill. So I know exactly what was said, what was intended and who voted for what, and I have recently refreshed my memory.
	Section 28 is a deeply confusing piece of legislation; indeed, it is more confusing today even than it was in 1988. Its aim, of course, is to prohibit the promotion of homosexuality by local authorities. The Government have made their position on Section 28 abundantly clear. It is an unnecessary piece of legislation. However, concerns remain, and I hope that during the course of our deliberations I shall be able to address them. Concerns have been expressed that repeal could somehow have an effect on what is taught to schoolchildren. One point needs to be made crystal clear to the House: the repeal of Section 28 will have no effect whatever on what is taught in schools. I shall repeat that: the repeal of Section 28 will have no effect whatever on what is taught in schools. Let there be no doubt that the Government's position is that children in schools should be protected from inappropriate materials and receive sex and relationships education that recognises the importance of marriage and stable relationships.
	Since Section 28 was last debated in your Lordships' House, the Learning and Skills Act 2000 has been passed which gives effect to the Government's policies and establishes a very robust framework for sex and relationships education. In particular, local authorities have no role in determining what is taught in schools. Section 28 plays no part in that framework. The matter is governed by the Education Act 1996 as amended in 2000, and therefore the repeal of Section 28 would not alter the framework in any way.
	In the Government's view it is time for repeal. This view received support from all parties in another place. I understand that repeal was endorsed on Report by a majority of five to one.
	The Bill as a whole will deliver significant freedoms and flexibilities to local government and will promote and facilitate real improvement in the way that services are delivered to local communities. It is welcomed by local government and business alike, although I accept that noble Lords will want to explore, scrutinise and debate certain areas. It is absolutely right that that should be so. I beg to move.

Baroness Hanham: My Lords, I thank the Minister for being so commendably succinct. I was going to say "brief", but I think the word "succinct" is more appropriate and polite. I cannot promise to be quite as succinct, but I shall certainly try.
	While the Regional Assemblies (Referendum) Bill could rightly be described as predicating a mish-mash of government, to which I have referred before, this Bill is a true pot-pourri, even if it is not particularly sweet-smelling. It is a highly technical concoction with some good and some very poor parts. Covering every aspect of local government from financial administration and accountability to council tax discounts and bands, it has wide implications.
	Having added a number of clauses on Report in another place, I wonder whether the Government intend to add further to the Bill during its progress through this House. I ask only because suggestions were made in the weekend press that they might seek to include an environmental policy, an initiative from Mr Meacher regarding charging residents who do not conform sufficiently to separating their refuse for recycling. Perhaps the Minister can address this very important matter when he replies.
	The Government have trumpeted their belief that the Bill brings greater flexibilities and freedoms for local authorities. Indeed, the Minister has just repeated that. It seeks to reduce red tape and, for high-performing councils, it offers greater scope for innovation. Local government will welcome that, and here I declare an interest as a member of a local authority. However, local government would not wish such opportunities to be available only to the golden few. As time goes on they should be made available to the whole of local government.
	What does the Bill amount to? Councils are to be allowed to fund major improvements and developments through the "prudential" borrowing system, so long as they can afford to service the debt. We do not know yet whether that will carry with it a compensating revenue commitment from the Government. Perhaps it is a point we shall be able to clarify with the Minister at an early stage. The principle of the freedom is welcome. But why, having gone that far, do the Government then decide to demand that capital receipts from the sale of council housing—or a high percentage of them—are to be paid to the centre for redistribution? That will create a housing pool which will leave in the Minister's hands the reallocation of those receipts for housing purposes, but against what criteria?
	In the sum of things, the £1.6 billion which may be raised annually from this source is minuscule in comparison with the enormous investment that will be required to meet the commitments already made by the Deputy Prime Minister in his White Paper on sustainable communities. Furthermore, it will deplete the independent reserve that any local authority might have built up to support a housing initiative in its own area. It would be fair to say that, in the past, such a policy crippled housing authorities and prevented much-needed capital expenditure on renovation and renewal.
	It is ironic that, under these clauses, a council which is debt free as a result of disposing of its housing stock and passing most of the proceeds on to the Government could, under the terms of Clause 41, find itself contributing indirectly to reducing or relieving the debt of other, possibly less prudent councils, by way of the Secretary of State making a payment to the Public Works Loan Commissioners on their behalf from the pool.
	The philosophy of redistribution is continued in the proposals to scoop up the surpluses from good, well-run housing revenue accounts and pool those so that they can be transferred to authorities which have a deficit on their accounts. We see it, too, in the measures to enable councils to levy a full rate on empty properties, but not to keep the resulting revenue. Those proposals alone could very well act as a huge disincentive to local authorities considering whether to embark on the policy. We see little evidence of freedom or flexibility and we will wish to consider the proposals in detail in Committee.
	We shall want to do the same with the Government's initiative to allow local authorities to retain some or all of the growth in business rate revenue. New Clause 71 received little scrutiny in another place, although it was broadly welcomed by my honourable friend Mr Hammond. But how welcome it is will depend on the chains and shackles which could limit what it may be used for. We shall be seeking much greater clarity on this whole matter. Can the Minister confirm that wide consultation among businesses, local authorities and professional bodies will take place on the policy? Furthermore, will that consultation return to this House and to Parliament?
	We shall also wish to probe further the Government's proposals for business improvement districts. It is a welcome sign of interest and commitment when businesses wish to become involved in financing a local initiative for improvement. As the Minister remarked, it is not unknown. Indeed, the White Paper makes it clear that already there are many areas where both landowners and business occupiers have joined together and resolved to contribute to a local authority plan to enhance or renovate their area. But, as the Minister also pointed out, those have been voluntary schemes. Business improvement districts will result from a vote by non-domestic ratepayers, which will become mandatory on all businesses in the area. As the Bill stands at present, that vote will be decided on a simple majority and then weighted for a majority based on the rateable values of the hereditaments.
	Concerns have been expressed by small businesses—in particular the Federation of Small Businesses, from whom I have heard on this matter—that a two-thirds majority would be more appropriate to safeguard the interests of small businesses. That point was also referred to in the Select Committee report. We shall press this matter further in Committee.
	As only non-domestic ratepayers are to be involved—the occupants of premises—the major landowners will not be involved in the electoral decisions on these schemes. Further consideration needs to be given as to how they become involved, at least by convention if not statutorily. Also, it is not clear how the local community other than the business community will be involved in the development and approval of any plans. The local authority will have to play a major part in any plans and partnerships, but we believe that the Bill should provide for the views of the local community to be sought on any proposals.
	I turn briefly to the provisions for rate relief for small businesses. Although the principle is welcomed, there are questions as to whether the threshold of rateable values of under £8,000 is too low. We will wish to consider suggestions that have been made to us that that should be increased to at least £10,000.
	There are a number of provisions relating to rates and council tax, not all of which I want to go into now. Subject to understanding the regulations, we would be broadly in favour of those regarding the local retention of non-domestic rates. On the face of it, that would give a local authority a larger local revenue base, as was confirmed by the Minister. However, the desirability of that will depend on the constraints put on it by legislation. It would be helpful if the Minister were able to reassure us that the regulations referred to in the Bill would be available before Committee, so that we might have an opportunity to consider them at the same time.
	We are not likely to be so accepting of the power to increase the number of council tax bands. Clause 79 is very wide in allowing the Secretary of State,
	"to make provision for a different number of valuation bands".
	How many and why? The glorious simplicity of the council tax is that it is partly based on property and partly on individual tax. The value of the property is meant to be only a part of the whole, not the deciding factor.
	When the council tax was introduced, it was understood that the bands were a device only to ensure that those in poorer areas of housing did not pay the same as those in more affluent areas. However, it also recognised that those in better-off housing might be impoverished, and those in poorer housing might in fact be quite well off. That is still the situation. The intention was that it should be simple to understand, and in general I believe that the relationship between the limited number of bands is comprehensible. The danger lies in the changing value of properties in various parts of the country. Those in the south-east of England are well in excess of those in the north, for example. Therefore, the burden of council tax could be once again shifted to those in this part of the country.
	We can understand the need to update the property values in the interest of accuracy, but the adding of further bands makes that look as though the Government might be intending to turn council tax into a property wealth tax, and without further parliamentary scrutiny. We would resist that approach. We all know that council tax bills have already risen enormously under this Government and that that is well recognised by those paying them. Further rises caused by bureaucratic meddling will surely not be very popular.
	One element of the Bill—that relating to attributing performance categories of local authorities—has already been implemented despite the fact that this legislation, which authorises it, has not been passed. Most authorities have now been assessed and placed in one of four categories. That seems to be an inescapable process now to release the best authorities from the plethora of inspection regimes, and to provide at least a modicum of relief from continual government involvement in local government affairs.
	That relief, however, does not necessarily apply to other measures relating to financial administration generally considered in local government to be unnecessary, particularly the statutory requirements for the monitoring of budgets and for the Secretary of State to set the level of reserves. I hear what the Minister says about that being intended only for use in councils where there are difficulties, but once legislation is in place it is likely to be used.
	There are also some concerns around the general power of the Secretary of State to provide grants to particular local authorities. Although that is suggested as being a mechanism to circumvent the need for specific grants, there is a much greater possibility—it was heavily denied by the Minister—that that could result in the Secretary of State having far too much power of allocation to particular authorities.
	There are two further matters. I do not intend to comment in detail on them now, but they may be addressed during the course of the debate and will form part of our deliberations at later stages. They are the provisions on the repeal of Section 28 of the Local Government Act 1986, and the new Clause 120 regarding the Fire Services Act.
	With regard to the first, if the Government continue to include Clause 121—it resulted from an amendment in another place—in the Bill to abolish Section 28 of the 1986 Act, I confirm that, if there were to be a vote, on our side it would be a free vote. We recognise that that is a very sensitive issue, and that there are strongly held views on both sides, some of which may well be expressed today. However, Parliament's job must be to ensure that children and young people are protected from unsuitable material and information, either supplied or promoted to them under any educational guise.
	We shall therefore press the views put forward by our colleagues in another place. In particular, we will table amendments to ensure that the existing departmental guidelines on sex and relationship education are strengthened and given the force of law, that rights are given to parents to force a ballot on the acceptability to parents of any sex-education material being used, and to give parents the option for their children not to attend sex relationship classes. Over and above that, we will put forward any other matters which in Committee we consider appropriate in that regard.
	Clause 120 repeals Section 19 of the Fire Services Act. That arises from the Bain report, as the Minister said. It was drafted before it was considered that the fire Bill, which has just been laid before Parliament and which would undo much of what is being proposed in this Bill in relation to the devolving to local level decisions about the employment of fire and emergency cover resources, might be necessary. In the light of that Bill, it is to be hoped that rational decisions are made by the fire service on the pay deal before it is necessary either to implement it or to consider further the provisions. I imagine that there might have to be changes, subject to the eventual outcome of those decisions.
	Clauses 102 and 103 refer to staff transfer matters. Essentially, they implement the statutory guidance on best value and performance, which is a code of practice on workforce matters in local authority service contracts. As they stand, the clauses effectively undermine the whole rationale of local authorities seeking to externalise any service through a contract. They imply that each contract will have to include that staff must be employed on standard local authority terms and conditions, as the contract must treat them as though TUPE applies. Whether or not local authority staff are transferred, Clause 102(1)(a) makes it clear that directions can be issued to that effect. Under those circumstances, we will probe the clauses much further.
	Finally, in another place my honourable friend Philip Hammond put forward an amendment to bring body-piercing establishments under a licensing regime. I understand from him that the Minister, Mr Raynsford, was inclined to accept the principle but felt that the amendment needed some attention to make it legally acceptable and enforceable. Does the Minister have any news on that, so that we can decide whether it will be necessary for us to reintroduce that amendment in Committee, or whether the Government will be willing to do so themselves?
	There is much to be done and we look forward to the next stages of this legislation, and the considerable debate it is likely to engender.

Baroness Hamwee: My Lords, during the recent debate on the Regional Assemblies (Preparations) Bill, I referred to local government as being one of the "spheres" rather than one of the "tiers" of government. The noble Earl, Lord Onslow, used a synonym to indicate that he thought that that was rubbish. I will try to maintain the fiction of being ladylike—at any rate, within the Chamber—so I shall not repeat the synonym but I stick by the term and my point. I referred to "spheres" of government because we are not discussing a hierarchy of importance—each level of government and each part of government are important.
	I must declare an interest as a Member of the London Assembly and currently its chair. In many ways my years as a London borough councillor were the most satisfying of any of the political jobs that I have done. For a time, at any rate, it was the most hands-on job. There has been much debate about whether the Bill is a centralising or decentralising measure. I start one stage further back: is it likely to increase or decrease participation in the political process?
	Civic engagement can take many forms: voting, of course; belonging to a neighbourhood committee; being a school governor and so on. Many have executive and scrutiny components. One means of engagement is as a councillor. That job must carry its own job satisfaction—that of doing, not just of being. I can see increasingly the strains on colleagues—members of a number of authorities—and officers. Because of the controls with which they must battle, those strains are greater than those that applied for some of the time that I was a councillor.
	Therefore, to the extent to which the Bill decentralises power, it is welcome. However, beauty being somewhat in the eye of the beholder, we on these Benches do not see all of the provisions as being quite as decentralising as do the Government.
	I acknowledge that much of the Bill is about returning autonomy to local authorities. Well, some autonomy is returned to some local authorities. It is extraordinary that our constitutional and legislative history mean that freedom is handed down. "Earned autonomy", as the phrase goes, is a contradiction in terms.
	When the Minister introduced the Bill in the Commons on 7th January, he said that there were "two key themes". The first was,
	"the need to devolve power and responsibility to local authorities. The second is the importance of driving up standards of delivery in every local authority area. The two are inextricably linked".—[Official Report, Commons, 7/1/03; col. 45.]
	Yes, my Lords, but the Government sometimes seem to apply the second theme as a sine qua non. We believe that autonomy of itself is a driver of good service delivery because it enables services to be designed for local circumstances. Of course things sometimes go wrong, but there must be the freedom to make mistakes.
	I must say that I, the Greater London Authority and the Mayor—I do not speak for him that often but I believe that I do so in this regard—remain to be convinced of the need for new statutory provisions in respect of minimum reserves, reports on the robustness of estimates, budgetary monitoring and so on. An authority already has to have regard to statutory budget-setting provisions covering reserves, proper financial administration, relevant chief finance officer advice, CIPFA guidance, external audit reports and so on. Are central government best placed to judge minimum reserves? For instance—I have grappled with this topic over the past three years—central government made no provision for reserves when they set up the Metropolitan Police Authority and Transport for London. In London, we wait to see whether our fears about the reserves that are available to London Underground are confirmed when it is handed over to Transport for London.
	The ways in which borrowing is controlled will exercise us in forthcoming stages. Defining long-term liabilities and just what is within the public sector borrowing requirement will not be a dry, technical exercise. I shall certainly try not to let my eyes glaze over about that. I sometimes believe that this is another case of "Through the Looking-Glass" and Humpty-Dumpty; it involves saying, "When I use a word, it means just what I choose it to mean. When I refer to the public sector borrowing requirement, it means what I choose it to mean". I share the concerns that have been expressed that with borrowing controls loosened, there is always the danger that the Treasury (on whose grants so much is dependent for so long) will not adequately support local government.
	My noble friend Lady Maddock will deal more extensively with the housing provisions of the Bill. I noticed that the Minister in the Commons referred to authorities with a genuine need to spend on housing investment being able to look forward to a new framework with confidence. Surely every authority has problems housing numbers of people who are in need of decent, affordable housing. In other words, they have problems with numbers and/or—it is often a case of "and"—housing conditions. Is there an authority without genuine need?
	Many issues are raised with regard to pooling capital receipts, as the noble Baroness, Lady Hanham, said. Is it realistic to expect local authorities to dispose of assets—to the extent that they have any—and to pool receipts, given that the regimes for local government finance appear to change so fast?
	I turn to council tax. There are no euphemisms about that. I noticed that Members in the Commons referred to progressive council tax on the one hand and regressive council tax on the other. Perhaps I may leave that with an exclamation mark!
	We will of course consider the issue of banding. Mr Raynsford said that much could happen by 2005. It is important in our view that the rebanding is robust enough for the medium term at least, whatever happens by 2005.
	We welcome the powers to trade and charge, but the dependency on CPA performance raises a number of questions in my mind. One of them—it is perhaps too technical for tonight—is about what happens if the performance assessment of an authority changes during the course of the contract. What is the position of the other authority? That involves the whole issue of vires. Some of us lived through the era of the Hammersmith swaps case.
	The honourable Member for Denton and Reddish, who is the joint chairman of the Select Committee, talked bluntly at Second Reading in another place about the performance of those assessing performance. He said that some Audit Commission decisions were extremely subjective and that some people from the Audit Commission who went to local authorities did not have a clue about what is going on. That will ring true to many. The most telling approval of the comprehensive performance assessment regime would be if central government departments submitted themselves to it.
	We have new statutory provisions, not a tax, in the business improvement district (BID) provisions. I wish that there was more time in which to discuss new forms of taxation generally. I refer for a moment to the desirability of examining the enabling of development, particularly of infrastructure, through new forms of taxation. It is obvious in London that businesses that happen to be on the route of the Jubilee Line extension have benefited significantly. Being able to harness—to tax—those who benefit from, for example, CrossRail—we hope to see that big new development—could enable that scheme to proceed.
	On BIDs, I am delighted that the noble Lord, Lord Jenkin of Roding, is involving himself with the Bill, given his hard work on that issue. He has previously raised it in the House. He will want to consider the role of owners as well as occupiers of property. I make it clear that I am an enthusiast for the scheme; I want to make it work. That includes, among other things, wanting to see the possibility of securitising an income stream, enabling capital to be released and invested in local schemes. However, I confess to being slightly troubled by the requirement of only a simple majority—50 per cent plus one—to impose what is, after all, a levy on those who may have voted against. I accept that there is a double lock of those numbers and rateable values.
	I am aware of the concern that such a scheme may, taken together with the business rate, appear a "double whammy", especially to small businesses. I thought that the RICS in that very helpful briefing hit the nail on the head, saying that business rates policies, as a category, are simply too complicated to be transparent to the person—in this case, the business—which pays them.
	Perhaps I may raise one small financial matter. I hope that we can find time to deal with it and a spot for it in the Bill. I am going very much from a major to a minor issue, but this is something which exercises councillors. I refer to the threshold for registration of gifts and hospitality, which is £25 for councillors as against £125 for MPs. That is almost unworkably low in London and the South East. It is topical for me because yesterday the GLA Standards Committee found itself looking at embarrassingly different assessments by a number of us of the value of a dinner which several of us had attended in the City. More importantly, the independent Member, who is a very senior Member, described the exercise of such a low limit as "time wasting".
	Bills such as this are often the repository for disconnected provisions. One of those here is to enable polls for local elections to be combined with those for European parliamentary elections. My personal view is that the convenience of electors overrides other considerations, but whatever the decision I beg the Government to let us have it soon to enable planning to take place.
	One other disconnected but hugely important provision is the repeal of the so-called Section 28. I expect that some speakers today will concentrate only on that. As has been said by the Minister, not only is it a sensible deregulation of redundant legislation, but it is much, much more. Honourable Members in another place were careful to base their arguments on the redundancy issue. For me, the repeal of Section 28 is hugely symbolic and I welcome it enormously. The suggestion that I have heard—that repeal of the section is designed to stop councils spending money on gay people—is one which would not, I think, be made about any other group.
	We shall examine the Bill not only in its own terms but also in the context of local government structures as they now are. The Government are letting go somewhat. They designed the executive/scrutiny split, and we shall ask what role they now see for the scrutineer in areas which are the subject of the Bill .
	There is a great deal to do. Tonight I have not even been able to start on the issues as they affect Wales or matters such as the benefits of charities extending to community amateur sports clubs. I promised that I would mention that. There is a great deal to welcome in the Bill but, sadly, not everything.

The Lord Bishop of Guildford: My Lords, first, I welcome the Bill and thank the Minister for his introduction, which was enormously helpful. As I have said before in this House, bishops bring to the House their own immediate experience of local communities. In my own case I and my colleagues have close dealings with two county councils and a number of boroughs and districts. The churches and faith communities have strong and day-to-day relationships with colleagues who represent the political and public needs of our local communities. Whatever we can do in this place to strengthen confidence and pride in the public service offered by all involved in local government, it is our duty to do. So, I welcome the Bill.
	The principle of subsidiarity, which is very much rooted in the Bill, is vital to the health of our politics and our service. We should always do all we can as close as we can to local networks and communities, which are the foundation of a healthy and democratic society.
	I hope that the Minister will forgive me for not, like the previous speakers, going through every area of the Bill. I want to comment on two issues, on one of which I am sure noble Lords would expect a bishop to comment. Clearly, I need to comment on the repeal of Section 28. But in both the issues that I want to raise we need to hold on to the principle of seeking to resist centralising power and encouraging local trust and responsibility in local authorities.
	That is why I believe this is a good moment to address the vexed issue of Section 28. There has been a great deal of debate upon it. As Members of the House will know, I have always found this particular section unhelpful. It is both a confusing piece of law and discriminatory. But others of my colleagues have taken a different view and quite a number of people, even though they have been concerned about the content of this legislation, have felt that to repeal it might be giving all the wrong signals and messages. So there has been a variety of perspectives around this and we need to be sensitive to all of them.
	However, all of us on these Benches, and I am sure more widely, welcome what I believe to be an argument that we are beginning to win; that is, that marriage is a public good for the health of our whole society, not just a good for those who enter that institution. It is good for people who are gay or straight, single, married, divorced, or in reconstituted families. Whatever styles of life people find themselves to be in, marriage is an institution that is a public good; we would say a gift of God to the human community. If marriage is not in good repair in our society, the whole community suffers. So we have a collective responsibility.
	I was grateful for the Minister's comments on the learning and skills Bill contribution to all of this. My good friend, the right reverend Prelate the Bishop of Blackburn, made a very important contribution chairing the Church of England's Board of Education in encouraging the use of that Bill to provide in this area. Perhaps I may remind the House of the guidance on sex and relationship education from the Secretary of State, which begins:
	"(1)The Secretary of State must issue guidance designed to secure . . . the following general objectives . . .
	(2) The general objectives are that the pupils—
	(a) learn about the nature of marriage . . .
	(b) learn the significance of marriage and stable relationships as key building blocks of community and society;
	(c) learn to respect themselves and others".
	It goes on in that vein.
	I am delighted to hear the Minister re-affirm the Government's commitment to that guidance. In terms of people who will be anxious about such matters, without putting things on the face of the Bill it would be good if the Government and all of us kept such matters under review so that the liberties that are given to local authorities are used well and that our gay and lesbian citizens who feel themselves to have been discriminated against in this piece of legislation are rescued from that feeling, which I think we have a public duty to do, and the community as a whole are satisfied that abuse of that new liberty will not take place.
	That, to my mind, is the good news. My second issue is a little more troubling. As a bishop in the south of England, I am not at all convinced by the Bill's provision concerning the use of capital receipts from housing sales by local authorities. Clause 11(2)(b) is the one which causes concern. As I understand it—I look forward to the Government's response to this—the effect of this clause is to pool resources from local authority housing sales and redistribute them across the country. I suggest that that is wrong in principle. I shall turn to the practice in a moment. This may be seen as a piece of Government taxation by the backdoor. The Government are taking the resources that thus far have seemed to be the responsibility of local communities and are putting them elsewhere. They purport to tax the rich to meet the needs of the poor. We all support the need to ensure an adequate distribution of resources in our society so that distressed communities across the country are able to meet housing needs, but not by another attack—dare I suggest—on the principle of local accountability for local resources. It seems to me that this provision goes against the spirit of the rest of the Bill.
	I suspect that the attack on principle goes further than that, because the people who are to have their resources raided are those who manage the resources particularly efficiently and well. So the measure punishes efficiency improvements in local government and debt-free local authorities will suffer the most. Thirty-two local authorities in the south of England of all political persuasions are debt free and all are at risk under this provision. An analogy put to me was that it is a little like a gardener who, seeking to kill off a few weeds, sprays weed killer across the whole of the flower bed. Flourishing work will suffer.
	I turn to the practice. I know that it has not escaped the Government's attention that we have a housing problem in the south of England. It may come as a surprise to some that even in the leafy suburbs of Surrey and north-east Hampshire, which is my part of the country, we have significant housing and homelessness problems. In the present housing market, in the face of homelessness local authorities have to provide for growing numbers of people who are on their lists.
	At present Waverley council, for example—one of those debt-free authorities that has a principled policy of using all its housing receipts for housing provision—has over 1,800 households on its housing needs register, 450 of whom are tenants of the council or housing associations in need of larger accommodation and 134 of whom are homeless households in temporary accommodation, nine of whom are in bed and breakfast accommodation. In 2001–02 the council rehoused 354 such families and households in council properties and 38 in housing association properties. Those figures fell to 271 and 31 the following year.
	I understand—the Minister can comment on this—that should this piece of legislation come onto statute law, the Government propose to phase it in over three years and at the end of that period only 25 per cent of receipts will be left in the hands of local authorities. I think that is bad politics and a bad principle. I wonder whether we can encourage the Government to think again about it. Maybe we need a provision to ensure by statute that the moneys received by local authorities from housing sales are used for housing purposes. Maybe there is another way of dealing with the matter.
	As I said earlier, there is much that we welcome in the Bill, not least its consistent approach across the face of the Bill in seeking to liberate and to trust local communities with their own affairs. That is vital for the flourishing of local government which has not had a good history in recent years. I look forward to seeing this measure proceed, with some improvements that your Lordships will bring to the Bill. I also look forward to the rest of the debate.

Lord Alli: My Lords, I wish to concentrate my comments on the new freedoms for local councils that will help to deliver improved services, on the new capital finance systems, and on the issues relating to capital receipts. Of course, I jest! Like a moth to a flame, I am drawn to the issue of the repeal of Section 28 contained in Clause 121.
	The last time we debated Section 28 I read out a letter from a 15 year-old boy. It said,
	"I am very depressed, and very alone. I used to be a perfect pupil getting high credit marks, but because of the bullying my marks have fallen. I can't tell anyone. I wish I was dead, just to have some peace. I am so tired—tired of living and tired of this so called 'life'. Because of the stress I can hardly eat and I have started taking lots of painkillers. Nobody knows I am gay. I have no-one to turn to and have no support from anyone. My life has been nothing but a bad headache. Some say we are all free people but we must question: are we really free? Is it so wrong being gay?"
	To any caring, loving individual one's natural instinct is to reassure that young man that being gay is not wrong; that he has a fulfilling life ahead of him and that he is valued as an equal member of our society. People ask me why Section 28 is important. Section 28 denies that reassurance to such an individual at a time when he needs it most. It creates confusion across a whole range of services and organisations.
	The opponents of the repeal of Section 28 talk about children. Let us face that issue head on because I am tired of this debate being hijacked by people who claim to be serving the interests of children. I say that not just because I believe that Section 28 has always been a law fashioned in bigotry, but also because the wider context in which Section 28 sits and the management of the policies that it was meant to regulate have been changed, updated and are now out of date.
	As a result, Section 28 is a law that is now completely redundant. That fact alone should be enough to support its repeal. Opponents to the repeal of Section 28 know as well as I that we already have a substantial structure of protection for our children. They know as well as I that there are guidelines already existing in relation to sex and health education in Section 430 of the 1996 Act. They know as well as I that there are guidelines and procedures built in to the role of school governors and parent governors ensuring that the will of the parents finds its place in the provision of sex education. They know as well as I that there is already a statutory basis in education law to protect children from inappropriate material. They know as well as I that this provision does nothing to protect a child in a school from inappropriate teaching or training materials. And they know as well as I that this is a piece of legislation fashioned out of prejudice and sustained by bigotry.
	Section 28 has long lost its place in rational debate. It has become, as the noble Baroness, Lady Hamwee, said, symbolic. Times are a-changing. I know that this House is moving on this issue and I do not want us to change Section 28 because of a threat from another place. It is worth remembering that another place has voted repeatedly on this issue. Its votes inserted Clause 121 into the Bill and those votes were free votes, a most important currency.
	To change Section 28 by consent of this House is my objective. I say to the party opposite, it has an opportunity to lead public opinion through this complex area. I want no political capital out of Section 28. The arguments are well rehearsed and I hope that when we finally come to debate whatever amendment emerges to retain Section 28 that noble Lords in all parts of the House, including the party opposite and the Lords spiritual, will find it possible once and for all to repeal a piece of legislation for which the time has passed. I wish the Bill well and I shall return to Clause 121 at a more appropriate stage.
	Forgive me for raising this issue when this Bill has so many other important sections that should be addressed. I hope that your Lordships will understand that I felt I had to voice my concerns in this debate. I look forward to what I am sure will be an interesting debate—I hope the last of its kind in relation to Section 28.

Lord Jenkin of Roding: My Lords, I hope that the noble Lord, Lord Alli, will forgive me if I do not follow him into that debate at this stage. I wish to confine my remarks to Part 4 of the Bill which introduces the business improvement districts. The noble Lord, Lord Rooker, called them BIDs; I suspect that most people will do so.
	I begin with a brief description of what BIDs are and how they work. The Outline of Proposals states:
	"The Bill provides a statutory scheme enabling local businesses to initiate a process by which, if there is sufficient demand in their locality, a business improvement district ("BID") can be set up. Demand is to be tested by a vote amongst the business ratepayers of the area concerned, overseen by the local authority. The scheme proposed in the Bill does not purport to be a model for all circumstances. Rather, it offers one tool through which some town or industrial improvement projects might be pursued . . . The business plan will be carried out by a company formed for the purpose. The company will be financed by a charge paid by the business ratepayers within the area of the BID unless the scheme exempts them.
	That is not a statement on Part 4 of the Bill. It is a statement about the Business Improvement Districts Bill, a Private Member's Bill which I introduced into the House over five years ago. It had its Second reading on 26th November 1997 and after full Committee and Report stages was read a third time and sent to another place on 10th March 1998; and that is where it stopped. So here we are, five years later and—if I may be guilty of a bad pun—it is BID time again. The Government's Bill is not exactly the same as mine but perhaps the House will recognise the present Bill's parentage. The noble Lord, Lord Rooker, can reassure the Deputy Prime Minister that I shall not ask his department for royalties.
	Part 4 is not this Government's first attempt to get non-domestic ratepayers to pay more rates for better services. Their original proposal was to legislate for "a supplementary rate" but, as the White Paper, Strong Local Leadership—Quality Public Services described, that found no favour with either local authorities or business. I need not quote paragraph 7.16. It clearly ruled that out. So the Government scrapped the supplementary rate and did what they should have done in the first place—go for BIDs, as now set out in Part 4 of the Bill.
	There are many similarities between this Bill and the earlier Bill. That is not surprising since both claim their inspiration from the BIDs system operating in many American cities. I was intrigued to read the department's press release on publishing the guidance notes which states:
	"New York-style schemes aimed at revitalising town centres and other business locations took a step closer today as Local Government Minister, Nick Raynsford, published new draft Government guidance".
	I shall return to that guidance in a moment. However, unlike the Government's ill-fated supplementary rate, Part 4 now has the support of the main local government associations and of the representative bodies of the business community. Again, I shall not quote what they said but I have the quotes with me if that is challenged.
	As my noble friend Lady Hanham said from the Front Bench, Part 4 will need careful scrutiny in Committee. However, today I have time to raise only one problem that the Government still have to resolve. I refer to the role of the owners, lessors, landlords of property—the freeholders who are not themselves ratepayers.
	The essence of a BID, as opposed to the voluntary schemes, which the noble Lord, Lord Rooker, mentioned, is that to take effect it must be supported by a majority, both by number and rateable value, of the non-domestic ratepayers occupying property in the defined area covered by the BID. If the majority votes "Yes", all must contribute. That is the point. In a voluntary scheme—and there are a good many in this country—there is no way of dealing with what are often referred to as the "free riders", firms who gain the benefit of the improvements that a BID can bring but cannot be made to pay the levy.
	In this country, the lessors of properties let to tenants are not the ratepayers because they are not the occupiers. Under the Bill, therefore, they will have no vote, no participation in the ballot. And there is no power to make them contribute. "So what?", you may say, "Surely the purpose of the scheme is to benefit the occupiers, the shopkeepers, offices, restaurants, cafes and so on which will benefit from the improved services and environment that a BID will bring.". But the Government themselves recognise that the owners, the landlords, have a vital role to play.
	I mentioned the BIDs guidance note. It is a valuable document, published earlier this year by the Office of the Deputy Prime Minister. At page 16 the question is asked:
	"Who can set up a Business Improvement District?"
	The answer is instructive.
	"A BID is a partnership. Any one of the partners in a BID may take responsibility for setting it up, including the local authority and any one of the businesses or landlords in an area. We envisage that in the vast majority of cases, local businesses and landlords will take the lead".
	When schemes operate successfully, it has always been the owners of the property in the area who have taken the lead and started it off. I received recently a description of a scheme in Oxford Street which has had a dramatic effect on improving the environment and reducing crime. The entire initiative came from the freeholders of the properties within the area. But under the Bill they have no vote in the ballot; any freeholder who does not want to contribute cannot be made to do so.
	It is difficult to see how that issue should be dealt with. The Bill allows them to contribute. That is right. There is too a great deal in the guidance about early consultation. That is right. But in the end free riders cannot be compelled to contribute. Amendments were moved in another place to put the matter right but they were rejected by the noble Lord's honourable friends on the Government Front Bench.
	In America, where BIDs originated, the real estate tax—as it is often called—is paid by the owners of property. It is a tax on the ownership of property. In the UK the non-domestic rate is paid by the occupier and it is a tax on the occupation of the property. As the Government argued in another place, to levy the BID charge in this country on property owners would be to introduce a new tax requiring complex and costly administration. I understand the argument. It was argued at great length in Standing Committee in another place by the mover of the amendment and the Minister. But I do not accept that that has necessarily to be the last word.
	The noble Baroness, Lady Hamwee, will remember that five years ago we debated this issue at some length in Committee and at the Report stage of my Bill. The promoters of the Bill envisaged that to gain acceptance by the voting occupiers, lessors would need to agree a fair apportionment of the cost of the BID levy between each landlord and his tenant. Often it is said that if you let under a 999-year lease the landlord has no interest in any BID. However, if the lease is to fall in next year, so that the freeholder will become the owner of the property, of course the answer is that almost the entire benefit of a BID will accrue to him and he should therefore pay the levy. It was said that without such an agreement between landlords and tenants, the scheme would never get off the ground—the ratepayers would not vote for it and it would not receive a majority.
	My Bill provided that if a landlord and tenant could not agree what was a fair and equitable apportionment of the burden of the levy, it could be referred to the county court. That is not the only possible solution. I have asked the representatives of the property world, who are anxious to be included in the BIDs scheme, to advance new proposals that might be framed as amendments to the Bill in Committee. As it stands, Part 4 is incomplete and we could do better.
	In the meantime, I welcome Part 4 as an old friend and look forward to improving his wardrobe.

Lord Shutt of Greetland: My Lords, in the debate on corporate governance on 12th March, the noble Lord, Lord Haskel, referred to Halifax town hall. It is one of those flukes that he is presiding over us this evening. Perhaps for the last time, I declare an interest as a member of a local authority. I have been a member of Calderdale Council, which is based in Halifax town hall, for 25 of the past 30 years. But last Tuesday, I did not submit any nomination papers and, therefore, have 28 days left. There has been some comfort in being in that building, being here and knowing that Sir Charles Barry was the one who designed them both.
	The noble Lord, Lord Haskel, referred to the inscription above the town hall in Halifax, "Act wisely". They have plenty to act wisely about. As I have reviewed the past 30 years, I have considered the loss of significance of local government. I thought, "When were the halcyon days? What was it like between the wars?". I have got hold of the minute book of Halifax council for the entire year—three and a half inches; just short of 2000 pages—for 1936–37.
	About half of the pages consist of lists of bills that it paid, rather than deep policy. But I then find that they had many committees—30 odd—but were a bit more sparing on sub-committees and working parties. They had committees to deal with health and hospitals; light, heat and power; public assistance; maternity and child welfare; and pensions. Not a PFI or a PPP in sight.
	Of course, much of that work was taken over by the state just after the war. But what has happened since? Just as I entered local government, public transport went to a metropolitan county, then to a quango, and was then privatised. The police were delegated to a local government quango—which is now rather less a local government quango. The same happened with the fire service. The ambulance service went with the health service, which was nationalised. Water and sewerage went to a quango and was then privatised.
	In my time, the colleges went to a quango. In our case, highways are quasi-regionalised. Housing is now in the hands of a social landlord—because that was how resources could be made available that would not otherwise be available to improve and enhance the housing stock. In education, local authorities have far less to do—I believe that to be a good thing, in that there has been delegation to those in schools with real responsibility.
	What is left? We have had the three "E"s of efficiency, economy and effectiveness; with best value we have the four "C"s of compare, challenge, compete and consult. I am glad that the noble Lord, Lord Rooker, said that he is trying to remove the jargon, because we have comprehensive performance assessments and, usually, we must have a strategic partnership somewhere.
	My council alone is involved in more than 100 partnerships. It is not alone in that. A multitude of councils is in the same position. It occurs to me that those who are acting wisely, if they saw the need, got on with it. Local government was a major building block of democracy. It is now debilitated and, rather than being a building block, is more like a wrung-out sponge.
	What of the Bill? For me, the foregoing puts it into some context. Reading the documents that have been made available to us about the Bill, it is interesting that the Select Committee on Local Government, Transport and the Regions in another place states, referring to local government:
	"Government must be prepared to trust it much more",
	For me, that is a test for the Bill. Will it help?
	I have four points. The first is the borrowing regime. It is suggested that it gives power and responsibility to the local authority; if so, I welcome it. We shall need to read the detail. What are the Minister's powers? Are they a back-stop or a front-stop. If they are a back-stop, so be it. Reference has already been made to business improvement districts. Will the business community wonder why it pays business rates in the first place? When considering what are termed business districts, one could have first, second, third, fourth and fifth-class business districts, depending on whether there is one or how much people want to pay. That may not be too bright an idea when considering our localities—especially the built environment.
	Secondly, will that be a reason for local authorities to stop doing what they are doing now because they say, "Perhaps it would be better done by business improvement districts. Then they can pick up some bills".
	My third point concerns council tax revision. I note the detailed points made about changing bands and this, that or the other, but the major thing about council tax is that it is to pay. The major feature of council tax that is to pay is that there is rather more to pay this year than last. That keeps happening.
	Without tinkering with council tax, we need a system in which people can have confidence. In 28 days' time, votes will be cast by people who are concerned and who will take it out on certain people they believe to have been responsible for the council tax being significantly enhanced. However, those councillors may have felt that they had no option, because of the disposition of resources made available by the Government, about what to do to keep services going for people in their communities.
	The Government must grasp the point that it is easy to push responsibility onto councils, so that they must stick up council tax to keep services going while the Government can say, "We are very good and do not raise taxes nationally".
	I should like to end on a positive note for the Minister. Vibrant local government needs good people. With one or two colleagues, last week I was asked to meet some bankers. They told us about their social and corporate responsibility. I suggested that they might be certain that their staff are able to serve local and national government to give public service. They said, "We cannot do that because of the Political Parties and Referendums Act. We have decided that we are not making political donations. If we give people time off to do these things, we shall have to declare it and don't want to do that". I am delighted that element is in the Bill so that banks, financial services and big business can be responsible. Often, people who serve as councillors work in some element of the public sector. The private sector will be able to play a better part and people will be given time off to do this important work. Serving as a member of a local authority is a high calling. It is important. It is also important that real opportunity exists, that it is not constrained and debilitated, and that council members can make their localities interesting, enjoyable and exciting places.

Baroness Gale: My Lords, I wish to speak specifically about Clause 76, which will allow English authorities to reduce or remove the 50 per cent discount that applies to dwellings with no residents for classes of dwellings prescribed in regulations made by the Secretary of State.
	Local authorities in Wales already have power under the Wales-only provision in Section 12 of the Local Government Finance Act 1992 to reduce to 25 per cent or to remove the current 50 per cent discount for classes of unoccupied dwellings as prescribed by the Welsh Assembly. Clause 76 gives English authorities some additional flexibility that is not included in the existing provision for Wales. Extending Clause 76 to Wales would allow the Welsh Assembly to prescribe classes of dwellings where a Welsh local authority may reduce the discount to amounts other than the 25 per cent or zero permitted under Section 12—and also to decide whether those discounts apply to the whole or part of the local authority's area.
	The powers conferred by Clause 76 on English authorities that allows them a degree of flexibility should be extended to Wales. It is absolutely essential for Welsh local authorities to be given those additional powers and I shall be interested to hear the Minister's views on that clause.

Baroness Blatch: My Lords, although I shall be concentrating on one issue, I am delighted by the remarks of the noble Lord, Lord Rooker, in response to the Select Committee on Delegated Powers and Regulatory Reform in respect of criticisms of the Bill. We all welcome what the noble Lord has said. That was a very critical report. It is worth noting that since the committee's inception under the last Conservative Government and subsequently under the present Government, its recommendations have always been agreed. We look forward to that continuing.
	Unfortunately, the Water Bill taking place in Grand Committee prevents my noble friend Lady O'Cathain from speaking in this debate. She wishes to contribute at later stages and will. She has asked me to express her concern about the repeal of Clause 28 and also wishes to persuade the Government to consider extending the power to license sex shops—a power that was secured by Westminster City Council via a Private Member's Bill.
	In this country, we have freedom of religion and belief. The state upholds the rule of law that provides the basis for freedom and tolerance—but it is right and proper for there to be safeguards against state imposition of belief. Those safeguards and protections are all the more important when the state provides services for children. Parents bear the heaviest responsibility for raising and protecting children. The state should not undermine the beliefs of parents. Nor should the state permit its employees to manipulate or indoctrinate children.
	Under current law, local authorities are constrained in three areas that can be the subject of controversy. In those areas, the law acts either to restrict the actions of local authority employees or to restrict expenditure of taxpayers' money. The first area is politics. Section 27 of the Local Government Act 1988 forbids local authorities from incurring expenditure for party political purposes. Education law also requires that when dealing with political issues, schools must give a balanced presentation of opposing views.
	The second area is religion, where regulation is extensive. Since 1944, there has been an elaborate procedure for determining the content of religious education in maintained schools. Each local education authority must have its own special advisory council to oversee what is taught. Teachers' unions still have a veto on the content of religious education. Among other safeguards, every pupil has a right of withdrawal from religious education.
	The third area of regulation is sex education. If politics and religion are controversial areas of the curriculum, so too is sex education. In 1986 Parliament amended the law to require that sex education was given in such a way as to have due regard to moral considerations and the value of family life. When I was an education Minister, that safeguard was not sufficient to assuage parental concerns. In 1993 I was personally involved in making sex education a discrete subject and delegating responsibility for the content of the subject to the governing bodies of schools. For the first time parents were given a statutory right for their children not to receive sex education.
	Subsequently I was involved in drawing up sex education guidance from the department, which was in place until it was revised in 2000 following further amendments to the law agreed by your Lordships. Those government amendments required that schools have regard to the new guidance issued by the Secretary of State.
	Many parents are concerned about the use of inappropriate materials in schools, which is why Parliament has regulated sex education. Those who support Clause 121 of the Bill and seek the repeal of Section 28 have failed adequately to grasp that point. They have failed to accept that sexuality—just like politics or religion—is a controversial area where parents have strong concerns that their children be protected.
	Opinion polls show that the vast majority of parents do not want homosexuality promoted in schools. In the referendum funded by Brian Souter, 1 million Scots voted to keep Section 28—86.8 per cent of those who voted. A poll carried out in the Prime Minister's own constituency of Sedgefield in 2000 found that 71 per cent of people wanted Section 28 retained.
	Parents are also concerned about inappropriate materials that cover heterosexuality as well as homosexuality. Section 28 was introduced for a reason. Some local authorities were actively promoting homosexuality in schools. Three years ago my noble friend the late Lady Young held an exhibition of inappropriate materials in your Lordships' House. Section 28 acts as a restraint for the majority of local authorities. If Section 28 is repealed and nothing is put in its place, what happens in a small number of local authorities could become the norm.
	The noble Baroness, Lady Hamwee, referred to Section 28 preventing expenditure by local authorities on gay men. That is not true. Local authorities do have a great influence on what is taught in schools. At the end of the day, they are the employers. They employ teachers and, like any employer, they are ultimately responsible for the conduct of their employees. In repealing Section 28, the Government are asking us to believe that a law that binds an employer has no influence at all over employees. That cannot be true, yet it is being claimed.
	The Minister in another place stated:
	"Local authorities have no say over what sex and relationship education is taught in schools".—[Official Report, Commons, 10/3/03; col. 85.]
	If only it were true that local authorities have no say or influence over sex education in schools. The Minister seems to be referring to the fact that specific duties on local education authorities with regard to sex education were removed in 2000. This followed a government amendment to the learning and skills Bill. Certain duties may have been removed but the important point is that LEAs still have a general supervisory role over schools. Legislation does not prohibit them from publishing and recommending sex education materials or from employing advisory staff.
	The Government expect LEAs to exercise this supervisory role with respect to sex education. That is clear from Section 351(6) of the Education Act 1996. That same section requires that whenever LEAs exercise these functions they "must have regard" to government guidance on sex education. But one can "have regard to" guidance without actually following it. One can also claim to be following the guidance when one is not. As the Minister knows, the only challenge is on procedural grounds and not on what the schools actually do.
	That is exactly what has happened. Some local authorities are pushing highly unsuitable sex education materials into our schools and they are praying in aid government's guidance. I shall give an example of what is happening in one area; namely, Brighton. Brighton and Hove Council and East Sussex County Council have a joint personal, social and health education advisory team. These PSHE advisors—eight part-timers in total—are using their powers to influence sex education to the full.
	In the year 2000 the council's advisory team published its own handbook for teachers. The council claims that the handbook is in accordance with government guidance. So what does the handbook say? It "strongly recommends" that schools buy a particular "essential" resource pack entitled, Taking Sex Seriously. A more unsuitable resource it is difficult to imagine. One lesson suggests that pupils are asked to buy condoms for homework. Another lesson has the aim of getting pupils to think about the full range of sexual activities. Teachers are told to,
	"give a few examples to get the group thinking along the right lines".
	The suggested examples include dressing up, tying up, sadism and/or masochism, partner swapping, anal intercourse or multiple partner at one time. Those are just the milder examples. Decency prevents me from reading out the rest.
	Brighton and Hove also fund a group called Gay & Lesbian Arts and Media—or GLAM for short. With council funding this group published a booklet which states that:
	"School assemblies need to reflect lesbian, gay and bisexual anniversaries like Stonewall as well as birthdays of famous lesbians, gay and bisexual people."
	That same booklet tells teachers that,
	"having regard to [Government guidance] does not mean 'adhere to'".
	Of course, in law, that is absolutely true.
	The Government place great faith in their guidance which was issued in 2000 to allay concerns about the repeal of Section 28. Having read the guidance, there is much which is ambiguous and unclear.
	David Blunkett was Secretary of State at the time of the last debate on Section 28. There was particular concern around that time about a resource entitled, Beyond A Phase, produced by Avon Health Promotion Service, an NHS body. In January 2000, this hit the headlines. The Sunday Times carried a full-page spread about this teachers' pack and video and widespread coverage followed, including ITV's "Tonight with Trevor McDonald".
	Of particular concern was the advice from one contributor—Karl—to the video, that children should,
	"Try experimenting with other boys and girls and see who you feel most comfortable with".
	David Blunkett said on the BBC that this particular resource was inappropriate for schools. He proposed tightening up the law to address the issue of health authority materials. Yet, over two years after his guidance, Beyond A Phase has been recommended by at least three local authorities. They are Brighton and Hove—no surprise—East Sussex and Gloucestershire.
	This resource pack includes an infamous series of "role plays" for pupils to act out. The roles include a married man who was "done" for cottaging, an out lesbian mother, a gay teenager, a married woman who had a "one night stand" with another woman, a bisexual granny, a sado-masochistic heterosexual woman, and a transvestite cabaret artist. Your Lordships, this is for children.
	In being all things to all men, the guidance failed to stop local authorities peddling inappropriate materials. The guidance has not stopped the use of Beyond A Phase. It has not stopped Brighton and Hove and East Sussex strongly recommending appalling materials. On the contrary, those authorities say that their advice to teachers complies with the guidance.
	Schools are not the only place where local authorities can influence what young people are being taught about sex. There are council-funded youth groups all over the country which have sessional youth workers employed by the local authority. If Section 28 is repealed, this work will be unregulated. The Minister in another place referred to guidance issued by the National Youth Agency. But, again, like Brighton and Hove Council, this guidance also recommends the appalling Taking Sex Seriously pack, which I quoted from a moment ago.
	Section 28 has proved to have a very positive influence to curb the worst excesses of council-funded youth groups. It is there for parents to use should they have a grievance about sex education. In 2000 a Glasgow nurse took Glasgow City Council to court under Section 28. She sought judicial review of their decision to fund a youth group, attended by children as young as 12, where a highly pornographic booklet entitled Gay Sex Now was being used. The legal action succeeded in having the booklet withdrawn from circulation. Section 28, in that case, worked. It blocked the distribution of homosexual pornography.
	I am particularly concerned that if Section 28 is repealed, there will be nothing to protect young people. Indeed the promotion of "well-being" powers contained in the Local Government Act 2000 seems to give carte blanche to local authorities to spend money on anything that they judge will promote well-being, however that is defined. This will almost certainly include more youth groups.
	The repeal of Section 28 is all the more worrying because of the Government's proposals for the Sexual Offences Bill. The Government have decided to give a blanket exemption from facilitating child sex offences for those who claim to be giving sex education. This exemption is in the form of an amendment to Clause 15 of the Sexual Offences Bill currently before your Lordships' House.
	Under the amendment a person who gives sex education will, for example, be able to facilitate the showing of pornographic videos to a child or facilitate the commission of sexual acts in front of a child. All this is possible as long as the person who gives sex education says that this was not his intended outcome. That is a perfect defence for someone wishing to corrupt young minds.
	A special exemption from the criminal law has never been necessary before. Now it will be. I shudder to think what sort of sex education is envisaged which requires exemption from facilitating a child sex offence.
	The noble Lord, Lord Alli, made a comment to which I take offence. I do not just claim to be concerned about protection for children; I do care about the protection of children. The repeal of Section 28 cannot be swapped for government guidance. If protection for young people cannot be put in statute—

Lord Alli: My Lords—

Baroness Blatch: My Lords, I shall not give way. I am just finishing. The noble Lord can speak before I sit down. If protection for young people cannot be put in statute to underpin guidance, Clause 28 should be reinstated. To guard against the worst excesses of those who take advantage of young people by peddling inappropriate sex education, parents, and especially children, need the protection of the law.

Lord Alli: My Lords, I apologise to the noble Baroness. In no way did I wish to cause her any offence. If I implied that, I apologise unreservedly. But my point is that she really must recognise that she does not have a monopoly on concern for children. There are people all around this House that believe so. On Tuesday night, she said in this Chamber,
	"However, I seem to be on my own in the Chamber in seeing protection for children as being absolutely paramount".—[Official Report, 1/4/03; col. 1238.]
	That is simply not true. We all seek to protect children. We just have a different view. I listen very carefully to what the noble Baroness says. I listen to her arguments all the time. But, please accept that everyone in this Chamber is trying to do the right thing and that no one has a monopoly on the protection of children.

Baroness Blatch: My Lords, I should like to make two points in response. First, if the noble Lord reads on in Hansard he will know that that was brought to my attention. I recognised that everyone in the Chamber was concerned with the protection of children. But I said that I was alone in seeking protection in the particular context in which I was seeking it.
	Secondly, the noble Lord said that people who take another view and who "claim" to be concerned about children do not actually concern themselves with the protection of children. I am simply saying that I claim, and I am, concerned about protection for children. That is the only rationale for me speaking in this debate.

Earl Russell: My Lords, to begin with, I cannot resist taking up the question posed by my noble friend Lord Shutt of Greetland on, "When were the halcyon days?". I am inclined to suggest that they were, roughly, from 1460 to 1760, which is quite a while ago. However, there were those even then who thought that they came to an end with the beginning of the power of Thomas Cromwell, who continued to load local authorities with what were described expressively as "stacks of statutes". Having picked them up, I can support the description.
	I congratulate the noble Baroness, Lady Blatch, on what she said about the Delegated Powers and Regulatory Reform Committee. The noble Baroness has a long and distinguished record in that respect. Both she and I have often worked together on the committee. I have no doubt that we shall do so again with great pleasure and, sometimes, I am very glad to say, to great effect.
	I wish to say a few words about Section 28. I shall not go into a lengthy debate it, because it has been debated a good deal. I just want to show that the flag is flying in this quarter, as well as in other parts of the House. I do not know whether the noble Baroness, Lady Blatch, remembers the occasion when Mr Aneurin Bevan described the Conservative Party as "vermin". She may perhaps agree with me that that was not a helpful contribution to the political process—

Lord Jenkin of Roding: My Lords, perhaps the noble Earl will give way. The words used were, "lower than vermin".

Earl Russell: My Lords, I am most grateful for that correction. In that case, it was an even less helpful contribution to the political process. It was simply common abuse. It was not a political argument that could be answered. If, for example, Mr Bevan had said that the Conservative Party "ground the faces of the poor", that would have been a specific assertion that the Conservatives could have set out to refute but you cannot do anything to refute mere abuse. It is not a debating argument; it is not capable of rational discussion. It simply says, "I don't like you". That is no way to conduct political debate.
	All of us, both in this House and elsewhere, have our likes and dislikes. We generally find that we conduct our processes in a more civilised way, even if we do not always get up and say so all the time. It seems to me that this is a perfectly fair parallel for Section 28, which forbids local authorities to do something—I genuinely cannot understand what. I do not understand what the word "promote" means in this context. As the legislation has never been taken to court, there is no court case to clarify it. So it forbids local authorities to do something unintelligible, which is genuinely not in their power to do.
	The noble Baroness, Lady Blatch, explained that she was responsible for transferring power to the governors. She then quoted a large amount of guidance. I cannot help thinking that she slightly overrates the power of the teaching profession. I know myself that it is very limited indeed. If youngsters were brought up on these guidelines, I suspect that they would come out about the most puritanical grown-ups in the country: they would be bored stiff with it. It is not as easy as the noble Baroness suggests. I do not believe that any of us has these sorts of interests.
	The function of Section 28 is simply to say, like Mr Aneurin Bevan, "We don't like you". That is not a useful comment to make to people whom we regularly meet socially, with whom we do business, and with whom we sit in the House. People cannot help having feelings. Some of them dislike the most unexpected people. But if we do not conduct our business with ordinary good manners, we really cannot get on.
	I also believe that it is part of the function of education that one should understand, at least very roughly, the outlooks of the sort of people one will meet socially. I have in mind a very wide range of people, an increasingly wide range of people. In conversation, one ought to know roughly when one is dropping a brick and when one is treading on people's toes. One ought to know what is likely to give offence. I speak from experience. I arrived at Eton, having never knowingly met a Conservative. So when I talk about unintentionally giving offence, I know what I am talking about. I do not think that that sort of ignorance was good for me. Similarly, I do not believe that the sort of ignorance promoted by Section 28 is good for people.

Lord Smith of Leigh: My Lords, I shall try to refocus the attention of the House on the rest of the Bill, so, in the words of my noble friend the Minister, perhaps the eyes can glaze over now. I should, first, declare an interest as the leader of a local authority, and as vice-chairman of another association called SIGOMA, to which there was an unfortunate reference last time I declared the interest. I hope that Hansard get it right this time.
	In the interests of brevity, I shall try to concentrate on the parts of the Bill with which I have some problems. I apologise to my noble friend the Minister for not supporting much of the Bill on Second Reading. I welcome the thoughts expressed in his introduction about freedoms and flexibilities and the desire for a new approach for local authorities. However, the Bill demonstrates the tensions within government and, in fact, much of it demonstrates exactly the opposite. Part 2 is a clear example of the centralising tendency becoming predominant again.
	If I heard him correctly, I believe that my noble friend said that he believes that there is a problem in a few authorities as regards their financial administration, and that the cure for it is the catch-all general legislation that will cover authorities. Good heavens, we may not have thought of budget monitoring, or checking that our reserves are all right, and so on! Of course, we have done so. However, my biggest concern is how all this is to be done. By what process will we check what will happen in local authorities as regards meeting the provisions in Part 2? When shall we receive the volumes of regulations, which, presumably, will tell us how we can decide whether our estimates are robust enough to meet the criteria? Which army of civil servants will be created to come and check us?
	What is missing from the whole section—which is surprising because it is in Part 1—is the role of the external auditors. It would seem to me that if we can enhance the role of these people, it would be simpler, more effective, and cheaper. I have a mind a solution that could be sensitive to local conditions. The level of reserves in some authorities may need to be higher than in others. An auditor would understand all that. I ask my noble friend to think about that as an option in these huge catch-all regulations.
	I turn to Clauses 78 and 79 on revaluing for council tax. The council tax bills that are going out now are based on valuations that are at least 12 years old. I always wonder about this arcane science that can say for a building that was built last year what its value might have been if it had been built in 1991. It must be wonderful to be able to do that.
	I remind your Lordships that in 1991 we did not have a very scientific approach to determining valuations. It was a matter of the famous estate agents going around, making a lot of money out of the previous government, checking on properties, looking at a street and saying "Band C", "Band B" or whatever else they decided. They were largely guesstimates.
	With any tax based on a valuation, the longer the period between revaluations, the more discredited the tax becomes. That was one of the problems with the old rating system. It took too long to be revised, and it was replaced by the poll tax—a great idea!
	I welcome any revaluation, but I ask my noble friend to consider whether 10 years may be too long for periodic revaluations. These days estate agents tell us what is happening to house prices on a quarterly basis. I am sure that it could be done on an annual basis. We could have a running revaluation programme, which would not involve such huge changes at the end of a 10-year period. We could perhaps use the 10-year revaluation to re-establish a base position, and then move forward again. I hope that my noble friend will also consider that.
	I very much support the Government in wishing not only to carry out such a revaluation, but also to revise council tax bands. Some research that I have seen recently shows an unintended consequence of a simple revaluation: the lowest tax bands in all regions do least well out of a revaluation. Even in the areas in the South East that would face an increase in valuation, the lowest levels would pay much more proportionately in increased tax. The lowest levels of tax bands on the whole reflect people's income and ability to pay. We should examine the matter carefully. Even a simple revision of tax bands, by splitting Bands A and H, would eliminate much of this problem.
	I wish to speak to Clauses 100 and 101, as leader not only of a council, but of an excellent authority. The noble Baroness, Lady Hanham, was very modest in not saying that hers is also an excellent authority.
	Looking at the clauses, one would think that the localist tendency is in the ascendancy and that we are gaining the ability to have more freedoms and flexibility. But looking at it from another perspective one can see that they are very slow to materialise. They are not supported in all parts of government, even in parts of my noble friend's department.
	I should like to quote from a letter—it is not about Wigan, so I can quote it—which reads:
	"The Office of the Deputy Prime Minister will take this opportunity to congratulate your authority for its efforts in becoming an excellent authority. Though we acknowledge the flexibility under this scheme, we wish to express to excellent authorities that the purpose for which the grant was awarded should not be ignored".
	That is a reference to ignoring ring-fencing of grants. If it does not suit government departments, they are not allowing it. If we can have a simple principle—"Invest in the best"—we can move forward the Government's desire to improve public service and provide a model for all local authorities.
	Finally, I ask my noble friend to consider an additional clause in the catch-all Part 8. Unlike most organisations, and notably private sector firms, local authorities have no right to sue as corporate bodies, even when they are defamed. I can give an example from my own authority—and my noble friend will understand where it comes from. We are repeatedly accused in writing of moving council tenants to house asylum seekers. Not only is it not true, but it is a highly politically sensitive issue. We have no right—other than trying to correct it in the press—to stop the organisation that continually repeats this untruth. I would not, of course, want a power to limit reasonable criticism of publicly accountable bodies; but there may be occasions when it is necessary to have recourse to the law in the interests of truth. I hope that my noble friend will consider remedying the matter in an additional clause.

Lord Sawyer: My Lords, I welcome the Bill and want to speak on staff issues. I am a member of UNISON, which is an interest in this respect. I want to comment in particular on Clauses 102 and 103. For many years, I have been deeply concerned about the effect which some of the privatisations and contracting out have had on the lowest paid and most vulnerable of local authority employers. I have previously spoken about that in this Chamber. I have urged Members who have listened to my words, or read them in Hansard, to read Polly Toynbee's publication, Hard Work: Life in Low-Pay Britain. That is an excellent documentation of what it is like to be a low-paid worker, providing basic local authority services; cleaning, cooking and care services. Those people have had to suffer dreadful reductions in pay and conditions.
	I have also stated that I am ashamed that my Government have introduced many of those changes, but we need to move on. In recent times, discussions between the representatives of low-paid workers and the Government have made improvements. We know that when local authority staff are contracted to a new employer, their local authority terms and conditions of employment transfer with them under TUPE. However, I could give experience of staff, for example, in Northern Ireland suffering a 60 per cent cut in their basic pay—a low rate of pay—and a reduction in holiday and sick leave. Concrete examples of that show that the TUPE regulations can provide only temporary protection of terms and conditions, sometimes over a short period of time, depending on how often the contract moves on and how different employers come to provide that service.
	Local authority terms and conditions are therefore eroded and are replaced with worse terms and conditions for those involved. Therefore, as the Bill progresses I shall be seeking to persuade the Government and local authorities to secure in their contractual agreements with contractors that the terms and conditions of transferring employees are "the same as" or "no less favourable than" those enjoyed as an employee of the authority. In addition, and most importantly, this contractual clause should apply for the life of the contract and apply to any subsequent employer who takes over the contract. These measures should be specified on the face of the Bill rather than being left to statutory guidance or directions from the Secretary of State.
	These standard terms and conditions include pay, annual leave, sick leave, sick pay, maternity leave and maternity pay. I want to make it clear that that would not prevent, or seek to prevent, employers from carrying out reorganisation of work, changing working practices or improving productivity or efficiency.
	Clause 103 deals with pensions and is even more difficult. It is a positive step towards statutory protection for pension rights of contracted-out employees. The clause would require local authorities to secure that transferring employees have pension benefits and rights which are,
	"the same as, or . . . broadly comparable to or better than"
	those they had as an employee of the authority. It is intended to apply to subsequent contractors as well, which is to be welcomed.
	However, as one would expect knowing the difficulties as regards pensions, the evidence and experience of contracted-out staff shows that "broadly comparable" pensions in practice can often mean inferior pensions. For a local authority worker, that is £3,800 a year—not a princely sum and we are certainly not talking about the fat-cat syndrome here. It will be difficult to find a way forward, but moving from broadly comparable pensions to pensions which are "no less favourable than" might be a way of ensuring that such staff do not ultimately receive inferior pensions, which can lead to poverty in later life.
	In practice, employers do not achieve the bulk transfer of past service from their local authority pensions, as they are led to expect. They often receive a money-purchase scheme rather than a final salary scheme. Changes to the pension scheme detrimental to the transferred employees are often made during the contract. "Broadly comparable" pension schemes are often capped.
	I have raised only three issues. The time is late and there is a great deal of detail to examine as regards terms and conditions. I do not want to do so today. I recognise that in particular on pensions the debate will be difficult, but I want to open up a dialogue and ask the Minister to consider how improvements might be made in those two areas.

Baroness Maddock: My Lords, looking around the Chamber, I see that we have a wealth of experience in people who have served in local government. Some of them still do so and some are about to give up. I particularly enjoyed the contribution of my noble friend Lord Shutt of Greetland on its history, which was added to by my noble friend Lord Russell. My noble friend Lady Hamwee outlined the views of those on these Benches, and in principle we support the Bill. It takes us in the right direction, as many noble Lords have commented.
	There are three important reasons why we support the Bill. First, it introduces a new prudential capital regime; secondly, it introduces—this awful word—BIDs; and, thirdly, it introduces council tax reforms. I shall refer to these matters in more detail later.
	Like other noble Lords, we are not without reservations. Interestingly, the noble Lord, Lord Smith of Leigh, who sits on the government Benches, appears to have more reservations than most noble Lords. We are disappointed that the Government have been rather timid in giving freedom to local councils. They have reserved powers to themselves in regard to capping, borrowing and minimum reserves. Other noble Lords, including my noble friends Lord Shutt and Lady Hamwee, also referred to this issue. Of particular concern is the fact that, despite being sold as containing less regulation, the Bill gives to central government almost 40 new regulatory powers.
	As a party, we have promoted the concept of BIDs for a considerable period of time. I was interested in the contribution of the noble Lord, Lord Jenkin of Roding. It will be interesting to pursue some of the points he has made when we come to later stages of the Bill.
	I received a map showing the location in Britain of the 22 pilot BIDs. As someone who now lives in the North East of England, I was disappointed that I could not see a single pilot north of Hull. It is to be hoped that that will change if the Bill goes ahead because the economy of the North East needs help.
	Like others, we support in principle the changes to the council tax, but we do not agree with some of the detail. In his opening, the Minister pointed out that a draft Bill was published and that there was a great deal of consultation. We welcome that. We sincerely hope that the views expressed during those consultations will find their way into the Bill during its passage through the House.
	Like the noble Baroness, Lady Blatch, and my noble friend Lord Russell, I am concerned that the Government should look carefully at the recommendations of the Delegated Powers and Regulatory Reform Committee. The opening comments of the Minister were very promising in this regard.
	The Minister referred to the issue of help for small businesses. There is wide concern in the Chamber that that help may not be as great as he indicated. We shall need to pursue that issue.
	In his opening remarks, the Minister was fairly straightforward in regard to Clause 28. We have had reasonable debates in the House on this issue. I sincerely hope that, as the Bill passes through its other stages, we shall be able to deal with it in a rational and reasonable way. I have always believed that this is a very controversial issue which appears to have been dealt with in an unnecessary and unworkable way. I do not dismiss people's concerns, but its time has come. We need to look at other ways of dealing with the concerns of people. We should certainly not deal with them through Clause 28.
	In her opening remarks the noble Baroness, Lady Hanham, posed a very interesting question. She asked the Minister whether anything further would be added to the Bill as it passed through the House. We shall be interested to see what happens in that regard.
	I shall need to go into more detail as regards housing finance, but I agree with some of the points made by the noble Baroness, Lady Hanham, in relation to that issue.
	The noble Baroness referred to council tax, as did many other noble Lords, including my noble friend Lord Shutt of Greetland. The real problem with council tax is that it is not related to ability to pay. For a number of years it has been possible for successive Governments to manipulate it in ways which suit whichever party is in power, and its finances. The sooner we can get away from that, the better it will be for all of us.
	The right reverend Prelate the Bishop of Guildford talked in his opening comments about the importance of local government for a healthy democratic society. I strongly believe in that, as I have said several times since I have been in this House. I found it particularly interesting to hear, although many of us know it already, about the role of the Church in dealing with many of the issues in the Bill, especially Section 28.
	I wish to highlight some of our concerns on housing matters. I declare an interest as vice-president of the National Housing Federation; I am also a patron of the Empty Homes Agency. I wish to dwell for a moment on empty homes. The agency and I welcome the proposals in the Bill to allow councils to change the way they charge for empty properties. However, councils are allowed to use council tax data. Before we get further with the Bill, will the Minister look at that? The Empty Homes Agency is finding worrying evidence that despite the Government's intention that councils should be able to use the data to help them with their empty property strategies they are still coming up against problems. I ask the Government to do a little more work in this area and respond at a later stage of the Bill.
	I am also concerned that the money that will be raised from empty homes will not go to the local authorities. If they are to have good empty property strategies, they need finance for it. What will the Government do with the money that is not going to local authorities?
	To a certain extent, I am worried about the provisions on discounts for second homes. The noble Baroness, Lady Gale, talked about this. There will be money from this and the Government have said that they intend to plough it back into affordable housing. I would like to hear from them quite how that will happen.
	On housing capital receipts, I shall be briefer than I intended because other people have already talked about this, and I associate myself and my colleagues with their comments. We believe that the principle that the Government can remove capital receipts from local authorities and redistribute resources from one authority to another sets a very dangerous precedent. It weakens local accountability and undermines local authorities' ability to manage their assets.
	This part of the Bill seems contrary to the intention to provide more flexibility and freedom for local authorities and to reduce central control. We believe that local authorities should have the freedom to develop locally appropriate policies and solutions. This issue is clearly of great importance in Guildford. The right reverend Prelate the Bishop of Guildford talked about this, and my honourable friend the Member for Guildford raised it in another place. It is a serious concern. Although the Government's intention is to find more money for really deprived areas, it has been pointed out that many authorities, which appear to be quite well off still have acute problems with housing, homelessness and, as the right reverend Prelate said, with people who are still in bed-and-breakfast accommodation, which the Government say they want to do away with. I am sure we will return to that issue in Committee.
	Clauses 40 and 41 introduce new powers to enable the Secretary of State to reduce or extinguish local authority debt and to pay some or all of the premiums that arise from early redemption. We shall go into that matter in more detail at later stages.
	There seemed to be some confusion in another place as to whether the Government intended to encourage local councils to transfer their council housing to registered social landlords. Already the Government are spending much money on overhanging debt yet the projected costs for 2002–03 are £500 million. For the following year the projected cost is something like £800 million. When one considers other sums that are being spent on housing that does not seem a sensible way to proceed if we are concerned about housing. There will be other opportunities to discuss that matter in more detail at later stages.
	Had this been a Liberal Democrat Local Government Bill, we would have moved further in freeing up local government and making clear that local government receives its democratic legitimacy and autonomy through the ballot box and not through the gift of central government. We should like to see councils' rights and duties included in a constitutional settlement. We should like to stop central government chipping away at local government powers. We should like to see local authorities made more accountable by giving them more control over their affairs, particularly their ability to raise funds locally. We would replace council tax with a local income tax. That is a fair tax, levied according to ability to pay. Massive savings would be made in collecting it.
	At the end of the day we believe that local councils are accountable to the communities which elect them. It is up to local people to decide whether a council is performing well or badly. Central government—I believe that this point was raised earlier and I have raised it before in this Chamber—have a poor record of delivering services. No external body sets their performance standards or is able to intervene when they fail. People will say that it is up to the electorate to make their views known by the way they vote at a general election. Why should not the same principles apply to local government, which has no less a democratic legitimacy than central government?
	As I said, the measure is a long way from our vision but nevertheless it moves towards it. I am sure that we shall discuss the issues in the spirit of this House. I am sure that the Bill will emerge from this House a better Bill. We intend to help to improve it.

Lord Hanningfield: My Lords, it is a privilege to speak at the end of such a stimulating and wide-ranging debate. I should declare an interest. Most noble Lords are probably aware that I am leader of Essex County Council. I speak in support of my noble friend Lady Hanham.
	The Bill before us today has well over 100 clauses. It is a long Bill, but it is a Bill that is short on vision and imagination. Will this Bill encourage people to go out and vote in local elections? Will it encourage a new generation of young people to enter politics to represent their local communities? Will it attract entrepreneurial and dynamic individuals into careers in local government? I fear that the answer to all those questions is no.
	Although the Bill has some provisions to commend it, which we shall discuss at later stages, it is basically a timid Bill. It is a strings attached Bill. Nothing in this Bill comes free. Virtually every responsibility given to local government in the Bill is hemmed in with caveats, qualifications and constraints.
	The Royal Institution of Chartered Surveyors in its evidence to the Select Committee noted that the Bill introduces over 50 regulation or order-making powers for the Secretary of State. In 70 pages of legislation there are 79 references to the Secretary of State's powers. If that is what the Government understand as devolution, they must have their own special dictionary in Whitehall. That point was very much reinforced by several noble Lords, in particular by my noble friend Lady Blatch, the noble Earl, Lord Russell, and the noble Baroness, Lady Maddock. I hope that the Minister will say more about how the Government intend to respond.
	The Select Committee report, published in July last year, made the point sharply when it stated:
	"The Government promised to redress the imbalance between central and local government. This Bill fails to achieve that. It makes some small steps in the right direction, but at the same time increases the power of the Secretary of State. Central Government seems to be terrified of trusting local authorities and allowing their independence".
	I cannot understand that culture of fear. A wide body of evidence now attests to the quality and capacity of local government.
	Sir Andrew Foster, the outgoing controller of the Audit Commission, stated in a recent interview for the Local Government Chronicle that perhaps local government should be saying to central government:
	"How well do we run things? How well do you run things? Maybe we could run some of the things you don't run so well".
	I shall touch on comprehensive performance assessments later, but, as several noble Lords have pointed out, it would be interesting if the Government were to put their own departments through some comprehensive performance testing. We should take note of statements of this kind. If anyone is in a position to judge objectively the current strengths and weaknesses of local government, it is the controller of the Audit Commission.
	There is much ground to cover in the Bill. I shall touch on some of the key issues. I apologise in advance if anything I say has already been covered by noble Lords in the debate.
	We welcome the scrapping of credit approvals and the freedom to borrow for capital investment, provided that the debt can be serviced. That is a new freedom to be granted to local authorities. But, as is typical of the Bill, what the Government give with one hand, they take with the other.
	First, borrowing levels will have to comply with a "prudential" code drawn up by CIPFA. That is sensible and something with which we can agree. What we cannot understand is why, having established the mechanism, the Government feel that it will still be necessary to retain powers to control borrowing by an individual authority. Surely that is the purpose of the code. It would be helpful if the Minister could clarify why this separate power is needed.
	Secondly, the Government can control the level of borrowing by individual authorities by imposing an aggregate limit on total local authority borrowing. That power should also be removed from the Bill. The result would be to provide local authorities with a genuine freedom, one that would be moderated by sensible and proportionate statutory controls through the CIPFA code. On that, I believe all noble Lords agree.
	As the noble Lord, Lord Smith of Leigh, pointed out, the heavy hand of central government can also be felt in the provisions to do with financial administration. Clause 26 provides the Secretary of State with the power to specify minimum levels of reserves for individual authorities. This power puts local authorities under a degree of legal prescription not applied to any other public body. If it is necessary for the Secretary to intervene in local authorities on the issue, why is it not necessary for similar powers to be exercised in relation to primary care trusts, many of which have larger budgets than local authorities? Similarly, why not target also the host of other non-accountable quangos that deliver services at the local level?
	At Second Reading in another place, the Minister, Nick Raynsford, made it clear that this provision was necessary in order to tackle a small number of poorly performing authorities. On 7th January 2003 he stated that,
	"a small number of badly managed and poorly performing authorities tarnish the good reputation of local government. It is in everyone's interests that those authorities turn around their performance and strive to match the standard of the best".—[Official Report, Commons, 7/1/03; col. 51.]
	He went on to say, at the same column,
	"that is why we make no apology for including the part 2 provisions in the Bill".
	There are two points of issue here. The first concerns whether adopting sweeping powers for an intervention covering all local authorities is really a proportionate or sensible way of addressing a problem that affects only a tiny minority of authorities. The second is whether such powers will have the effect ascribed to them by the Minister. That was certainly not the view of the Select Committee. The report comments on this matter by saying:
	"We did not receive any evidence that, had these particular measures been in place, they could have prevented financial imprudence".
	CIPFA has also expressed doubts about the power. It has described the setting of balances as,
	"a very local decision and judgement".
	I ask the Minister to tell the House how he thinks that the Secretary of State can reach a better judgment about the appropriate level of balances in a local authority than the chief financial officer of that authority, whose duty it is to report on the adequacy of reserves.
	Much has been said about the business improvement districts, which I think we can call the sons of my noble friend Lord Jenkin. I would not wish to repeat all the arguments on them, but I ask the Minister to note some of our concerns, which I am sure we are going to discuss in Committee.
	Regarding the powers on council tax bands, we support the need for regular revaluation of properties. However, I am told that if the Government go ahead with the revaluation, it will be the first carried out since the war in local government by a Labour government. Every post-war revaluation has been carried out by a Conservative government, so we shall wait and see. We generally welcome it and also the power to change the discount on second homes. But we have reservations about the power to change the number of valuation bands.
	In a county such as mine, where average property prices are surging way ahead of rises of income, it will be families of modest resources who will be hit hardest by the introduction of an additional band between G and H. On top of rises in national insurance contributions and the new grant distribution formula that redistributes grant from the South East to the Midlands and the North—we have discussed it several times before—it could be seen as another stealth tax imposed on the south-east of the country.
	Clauses 100 and 101 deal with the comprehensive performance assessment. For noble Lords who are not familiar with the process, it may be helpful if I provide some background. Local authorities are already subject to heavy regulation by external inspectorates such as Ofsted for education and the Social Services Inspectorate for social services. We conduct best value reviews which are subject to external scrutiny through the Audit Commission, and the soundness of our finances and corporate governance arrangements is reviewed by external auditors. That is the framework, but I assure noble Lords that there is a great deal more to it. For an authority such as Essex County Council, it adds up to approximately 170 days of inspection every year.
	The clauses introduce another scheme of inspection. Under the CPA, the Audit Commission pulls together the information from the various inspectorates to reach a view as to the overall quality of services delivered by an authority. It then comes to the authority to look at the quality of its corporate management—to make a judgment on its corporate capacity. Those two dimensions are married up, put into a black box, and marks out of 48 are produced. I do not need to highlight to noble Lords the painful absurdity of marking out of 48 a democratically elected tier of government such as Essex, serving a population of 1.3 million people and with a budget of £1.2 billion a year.
	The corporate capacity element of that exercise is a new part of the inspection process. Last year, when we had our CPA inspection, the team was based in Essex for two weeks. I personally spent 17 hours during that period with the inspectors. The time of senior officers that went into preparing and managing the inspection ran into thousands of hours. I have no doubt that when the inspectors left they were in a pretty good position to judge the strengths and weaknesses of the council, but that is really not the issue. The issue is whether that is the best use of public money, given the limits on resources to which we are all subject.
	I would be interested to know why the Minister thinks that the quality of public services delivered by a local authority and attested to by external regulation should not be used as a proxy for judging corporate capacity. He will no doubt say that the CPA will lead to a reduction of inspections. That is something we could welcome. It would be helpful if he explained why the level of reduction for each category of authority is not in the Bill, and also whether the reduction in inspection activity will relate to all inspectorates—to Ofsted and the SSI as well as to the Audit Commission.
	We welcome the power set out in Clause 117 to enable local authorities to hold advisory polls. I would be grateful for the Minister's views as to whether he would consider it appropriate to conduct a poll of the people of Essex about whether the county council should invest its resources in preparing for inspections or the delivery of public services. I should be interested to hear his views.
	There are, without question, parts of the Bill that can be welcomed. The new clause introduced by the Government on Report to enable local authorities to retain some of the growth in its business rate revenue in our areas is a proposal that we can broadly welcome. We will obviously scrutinise it well in Committee, as my noble friend Lady Hanham said. We also broadly welcome the new powers to charge and trade.
	There are a large number of detailed issues that we will explore in Committee. I should like to discuss housing receipts, which received considerable comment from the right reverend Prelate the Bishop of Guildford and the noble Baroness, Lady Maddock. We will explore that in Committee.
	In a relatively short debate, we have had three major contributions on one small clause, Clause 121, which involves Section 28. We shall no doubt debate that at considerable length at other stages of the Bill.
	Central government say that they are committed to local government. They want to provide local authorities with more freedoms and flexibilities. They want to do that, presumably, because they recognise that step changes in the delivery of public services can be made only by releasing local authorities to respond creatively and dynamically to local needs. They cannot do that if they are fettered at every turn and tied up in red tape.
	However, anyone who works in local government will tell you that that attitude towards local government certainly does not permeate the whole of Whitehall. A couple of weeks ago, I received, in my capacity as leader of Essex County Council, a letter from the Secretary of State for Education. He said:
	"I am very disappointed at the level of your proposed schools budget and I have no doubt that the authority's schools will take a similar view. The proposed budget implies that the authority proposes to pass on only 99 per cent of the increase in schools funding".
	I particularly like the phrase, "only 99 per cent".
	In our grant settlement from government, we received an increase of only £28 million—the lowest of any county. The amount we were required to pass on to schools was £35 million; that is, £7 million more than our total increase in grant. In other words, simply to fulfil that government exhortation, we had to use all our additional grant—ignoring pressures on social services, roads, waste disposal and other services—and put council tax up by 2 per cent to fund that single requirement.
	I do not believe that the Secretary of State for Education and Skills could have understood that when he wrote his letter. A democratically elected body, responsible to local people, would be absolutely deficient in its responsibilities if it did not look hard at whether it could fulfil that sort of requirement at a cost that local people could afford. We hear all sorts of noise about the levels of council tax; this is the sort of thing that causes that. We see the freedoms on one side and the control on the other.

Earl Russell: My Lords, has the noble Lord, Lord Hanningfield, discovered that for the Treasury the proposition that a sum of money is sufficient for the purpose for which it is voted is always a tautology?

Lord Hanningfield: My Lords, we note the comments of the noble Earl, Lord Russell.
	A democratically elected body that is responsible to local people must take the level of council tax into account. That demonstrates how far removed Ministers are from the day-to-day realities of real life, which those of us in local government still face, and the lack of respect that exists in some parts of government for genuine democratic accountability. Perhaps the Minister will comment on that.
	Since 1997 this Government have introduced over 100 parliamentary Bills and over 2,000 sets of regulations that have a direct bearing on the operations, services and functions of local government. Never can there have been so much activity for so little reward. I am very pleased indeed that this Government are committed to deregulation. I cannot imagine how many Bills and regulations they might have passed if they were not.

Lord Bassam of Brighton: My Lords, my noble friend Lord Rooker tells me that the noble Lord, Lord Hanningfield, has made possibly the longest speech in tonight's debate. As noble Lords know, the noble Lord, Lord Rooker, has an enviable reputation for brevity and being bold and to the point. So my task is to try and ensure that I take no longer than the noble Lord, Lord Hanningfield. I am sure that noble Lords will be delighted to hear that. However, I am set a very difficult task. I have some 50 sheets of notes and associated points of detail on which questions have been asked. I am unlikely to go through those. If I did there would be some rather depressed souls in your Lordships' Chamber.
	However, one thing about today's debate which particularly pleases me has been the breadth of contributions from all sides of the House and the great interest in the very many different aspects of what is a wide-ranging Bill. I think that is a commonly agreed point. Important differences have been expressed during the course of the debate. In particular, I suppose that the noble Lord, Lord Hanningfield, was the gloom and doom merchant from the Opposition Benches, but then I would expect that. He made a speech which sounded terribly similar to a speech I made in the Brighton council chamber some 20 years ago when I was arguing fiercely against the ghastly financial constraints that were then being placed on us by the noble Lord, Lord Jenkin of Roding. Recently, I unearthed a press release which was attached to my speech at the time. There are many ironies in your Lordships' Chamber, but that was one that I particularly enjoyed.
	I also enjoyed, for very different reasons, the tease from the noble Lord, Lord Alli, in threatening to go through the great minutiae and detail of the Bill. Sadly, I have to do that job, and it gives me great pleasure because for 20 years and more of my life I have been involved in local government and I have enjoyed it greatly, for it is a very beautiful thing.
	As I said, the debate has been very wide-ranging. There is no way in which I can cover all the points raised, but many issues have been raised which deserve an answer. We shall write to noble Lords about any points I do not cover and ensure that an explanation is given. We shall have an opportunity in Committee to pick up very many of those issues in considered detail.
	Most emphasis was placed on the desire of all of us to reduce red tape and the burdens placed on local government. I think we all share that common commitment. In welcoming the Bill, the noble Baroness, Lady Hanham, seized on that point, as did the noble Baronesses, Lady Hamwee and Lady Maddock, and I believe they welcomed it. The noble Lord, Lord Shutt of Greetland, was rather more questioning as to whether he thought a new golden era was about to dawn. Nevertheless, he welcomed the Bill too. That shows that we are heading generally in the right direction. After all, I am sure many Members of your Lordships' House would agree that there have been many years when perhaps there has been too much of the heavy hand of central government disposed towards local authorities.
	We believe that we are reversing that process. We are proud to be associated with that. There are times when it is absolutely right that the centre should take a firm hold. But we also believe strongly in devolution. I believe that the Bill, with its many deregulatory moves, particularly in the field of finance, is right to move in that general direction.
	We have also had an interesting debate on Section 28. I suppose that the most discordant voice on that came, as one would expect, from the noble Baroness, Lady Blatch, who speaks with great passion, even if one does not always agree with her on the subject. I shall resist the temptation to retreat to the fiefdom of Brighton and Hove and make responsive references to the point she made on that except to say that my children go to local schools. If she was trying to scare me about sex education in the borough in which I live I am afraid she failed. So far as I can see, sex education in the local authority whose services I enjoy seems on the whole to be very well conducted indeed, as it is in most others.
	This debate is not about protecting our children in the terms that the noble Baroness has attempted to set out. Repealing Section 28 is important. It is not just totemic. Many noble Lords said that it was symbolic. In 1988, when it was passed into law, many of us in local government felt a great sense of shame that the government of the day decided to visit it upon us. Representing, as I did then, a local authority with a large lesbian and gay community, I was particularly affected by it. It made running services across the board, particularly for those from that community, difficult indeed. They treated us with a great deal more suspicion than perhaps was right and proper. It made our lives very difficult and it painted local government in a way that was not helpful. I am proud that we are associated with repealing that clause. We need to persuade this House of that. It is long overdue.
	I shall go through some of the questions raised on specific points and I shall deal with the issues in turn. The noble Baroness, Lady Hanham, asked some important questions about the prudential borrowing regime. The prudential borrowing system gives authorities freedom to borrow without government consent if they can afford to service the debt without extra government support. We shall continue to support the major part of local authorities' borrowing programmes and shortly we shall consult on future arrangements for that support. In our view the prudential system will allow extra self-financing investment on top of whatever we, as the Government, support.
	The noble Baroness also asked whether we would be able to make draft regulations available on the business rates retention and on the growth incentive element of that. We intend to consult—a strong theme of this piece of legislation—all interested parties on many details of the proposed scheme. We cannot make draft regulations available until that consultation has been completed in the autumn. However, I can give the noble Baroness an assurance that we shall produce a detailed memorandum on our objectives for the scheme for consideration by your Lordships' House.
	I have dealt with Part 8—the noble Baroness, Lady Hanham, like others, raised that important concern. We shall have the opportunity for greater debate in Committee.
	The noble Baroness raised the issue of small business rate relief, which has been broadly welcomed. We take the view that a balance has to be struck between the small businesses receiving the relief and the larger businesses paying for relief by a supplement on the non-domestic rating multiplier. Under the current scheme the rate bills of larger businesses need to be increased only by less than 2.5 per cent. That would necessarily increase if the threshold of businesses receiving the relief increased. That is a very important consideration. No doubt the noble Baroness will wish to raise those issues when putting forward her own proposition in an amendment.
	She also asked a couple of interesting questions on smaller matters. She asked whether it is our intention to raise a new tax on recycling. No, we have no intention of doing that. She asked about body piercing—we have had a wide-ranging debate extending from body piercing to council tax relief. She asked whether we would bring forward an amendment to licence body-piercing establishments. It is important that issues relating to that are addressed in a collective way. Our intention is that there should be further discussion with colleagues to try to achieve the best way forward on that. Parliamentary time may not allow such a measure to be put into the Bill, but we appreciate the point that she raised.
	The noble Baroness also raised a key issue—one that the noble Lord, Lord Jenkin of Roding, also raised—about the involvement of local people in the BIDs process and whether we intended to put that on the face of the Bill. We recognise the importance of support for all local stakeholders in that area. We recognise that that will be vital to the success of BIDs. It is important that local communities are consulted. We question whether the mechanism suggested by the noble Lord is right. However, we look forward to further debate on those issues in Committee and to hearing other noble Lords' contributions. BIDs is an important initiative which the Government strongly support and one that I supported from a local government perspective before we came to government.
	I recognise that there is concern about pooled capital receipts. Council housing is, of course, a local asset, locally managed, and so on. But it is also a national asset and the benefits, accrued receipts, and so on, need to be considered in a broader national context. Of course, concerns will be expressed locally about the change but we believe that as a redistributive mechanism it is an entirely fair way to proceed.
	The noble Baroness, Lady Hanham, and a number of noble Lords raised the issue of council tax bands. She asked whether we agreed that there should be new bands and to consider the relative balance between poor and rich in housing. She asked whether it was a new property wealth tax. As we made clear in our White Paper, we shall listen to local government and taxpayers ahead of revaluation. As the noble Baroness will appreciate, the White Paper recognised that making the tax more progressive—for example, by changing the ratios—could have a regressive impact. We have to take careful account of that.
	The noble Baroness, Lady Hamwee, asked whether changes to banding would be robust enough, regardless of house prices. We cannot foresee the property market in 2005, or how it will change by 2007 when the new bands will be implemented. But we shall take every sensible step to ensure that the banding scheme is robust to reflect those changes.
	We are grateful to the noble Baroness, Lady Gale, for raising an important issue. She asked whether Welsh local authorities could have the same flexibility as that proposed in Clause 76 for English local authorities on removing or reducing council tax discounts. The matter has been raised with my right honourable friend the Minister for Local Government by the National Assembly for Wales. It is an issue that we shall consider. I give an undertaking today to come back to your Lordships' House at a later stage of the Bill with a decision on whether or not we shall be able to amend the Bill to achieve that objective.
	We recognise the important issue raised by the noble Lord, Lord Sawyer, on the transfer of staff. We want to offer assurances to those who may be affected by such changes in the future. I am happy to confirm to the noble Lord that we shall ensure that the provisions covering contracting-out exercises will include the same protection for staff as enjoyed by those in central government and its agencies. They will ensure that if authorities select private or voluntary sector providers, it will be on the basis of their ability to deliver high quality services, not by cutting costs or driving down staff terms and conditions and pensions. I can give that assurance. The Government will be more than happy to continue to have dialogue with the trades unions affected which may have some other outstanding concerns.
	I conclude by reiterating that, despite the complex and detailed issues in the Bill, the Bill should be broadly welcomed today not only by your Lordships' House but local government generally. Indeed, the Local Government Association has given the Bill its blessing. In a recent release, I think it said that it believes that the proposals in the Bill represent significant new freedoms for local councils and will help them deliver improved services to their communities. If I were still a local government leader, I should certainly subscribe to that as a commentary. It is also promising that the Confederation of British Industry has put on record its welcome for many aspects of the Bill.
	I have enjoyed this afternoon's debate. I have listened with great interest to all that has been said. I apologise to noble Lords to whose questions I have not fully responded. I hope that the House will not just like the Bill but enthusiastically give it a deserved Second Reading. I commend the Bill to the House.
	On Question, Bill read a second time.

Congo

The Lord Bishop of Winchester: rose to ask Her Majesty's Government what is their response both to the final report of the United Nations Panel of Experts on the Illegal Exploitation of Natural Resources in the Democratic Republic of Congo and to recent events there.
	My Lords, I declare an interest as a member of the All-Party Group on the Great Lakes Region and Genocide Prevention; as bishop of a diocese with a partner relationship with the Anglican Church in the Congo; and as patron of the Congo Church Association. In those last two capacities, I spent two and a half weeks in the region last October and November at the invitation of the Congolese archbishop and in the company of Congolese—two of those weeks spent in four different locations in eastern Congo. Some 2.5 to 3 million people have died in eastern Congo during the past five years as a result of war, chronic theft and pillage on the grandest scale and the sheer absence of any order and security.
	The armed forces of as many as six neighbouring countries have been operating in the DRC in recent years—those of some are still there, together with the forces of their various regional proxy warlords and all sorts of armed groups, bandits and deserters. They include a large number of child soldiers—whether taken from their homes or orphaned. Many hundreds of thousands of people live in the constant fear that a total lack of order and security imposes on them. Many thousands sleep in the bush every night. Many hundreds of thousands are displaced, many of them more than once. In a fertile country, there is widespread hunger. Disease of all sorts is rife. Millions are without any access to medical facilities.
	Virtually the whole of the proceeds of the DRC's enormously rich mineral resources are stolen by its neighbours. Tribal and regional conflicts have been manipulated to near-genocidal proportions, especially in Ituri in the north-east, by neighbouring states, or by sections of their armed forces, in their own interests.
	On March 5th, in another place, the honourable Member for North Norfolk, Norman Lamb, initiated a debate on Rwanda and the Great Lakes with a detailed and distinguished speech. Ministers and officials from both the Foreign Office and the Department for International Development are, to my knowledge, giving the region significant and consistent attention. I thank them for their courtesy and the time that they have given me, but I share with Mr Lamb the conviction that the issues in question are of a scale and urgency that require from the Government—whether acting alone; in concert with European partners; or at the United Nations—a great deal more than they have yet committed themselves to seeking to deliver, and within a much shorter timescale.
	The final report of the UN panel of experts was published last October. It makes shocking reading. Having read it within days of my return from the DRC, I can say that it rings true throughout to what hundreds of ordinary people told me was happening. The panel's reports have exposed in considerable detail—naming names of countries, individuals and companies—the character of the systematic looting and exploitation on a vast scale of the natural resources of the DRC during decades, which continues today. They have established multiple links between that exploitation, the continuing and endemic conflict and the suffering of millions of ordinary Congolese—links that a series of other reports, researched and produced by NGOs and the all-party group, have repeatedly described in recent years.
	The final report details the equipping and training by foreign armies of a kaleidoscopic range of militias and warlords and their provoking what have become viciously brutal and destructive tribal conflicts. It notes that even where foreign forces withdraw from DRC territory, they embed proxy governments and criminal networks to ensure that illegal exploitation continues—to the extent that, as paragraph 152 states,
	"the war economy operated by the three elite networks operating in the DRC"—
	those linked with the armed forces if not with the Governments of Rwanda, Uganda and Zimbabwe—
	"dominates the economic activities of much of the Great Lakes region".
	It is not surprising that the range of parties named and shamed in that report dispute its findings. The panel notes its uncomfortable relationship with the Porter Commission set up by Uganda to investigate the same range of allegations against its nationals and the UPDF. The panel of experts has been given a further mandate until 24th June to respond to its objectors and to provide the further evidence that some of them, including Her Majesty's Government, have required.
	Since 1999, there has been a peace process for the DRC, perseveringly supported by not only South Africa but our own Government. Accords were signed in Pretoria in the middle of last year by the DRC Government—which controls from Kinshasa about two fifths of that whole vast country—Uganda and Rwanda. That process has continued through further rounds of negotiation between the various faction leaders and Kinshasa into the first part of this week.
	Seen as a whole, those processes commit Uganda and Rwanda to the complete withdrawal of their armed forces from DRC territory and to ending their support for the range of competing factions that they have fostered and armed over the past 10 or 12 years. The processes promise an administration in Kinshasa in which most of the competing faction leaders will have a stake and will over time be able to exercise government over the whole country. Our own and other governments are poised to offer the range of confidence-building technical and military assistance through which a unified army, police, customs, justice and every other kind of medical and educational service can be developed to provide for the population's security and welfare.
	Critically important obstacles have yet to be ironed out. The main players still do not judge that they can safely gather in Kinshasa to begin that intimidatingly large and delicate programme of work. Meanwhile, since the spring of last year, freshly in the last months of 2002, into this year, and then in the past few weeks the forces of some who signed the accords have continued to fight each other. There have been renewed and still-worsening outbreaks of vicious tribal killing, pillage and destruction in Ituri—where millions of already-weakened people are quite beyond the reach of those few NGOs that still have expert and committed personnel in the area. There are well-grounded fears—especially after the expulsion from Bunia on 6th March of the UPC, following the latter's increasing liaison with the Ruanda-backed RCD-Goma, and the subsequent wave of tribal revenge killings and destruction across the wider area—that Ugandan and Rwandan forces may again clash on Congolese soil. That would very likely wreck the already nearly stalled peace process and set back by years the chances for peace in the DRC and across the region.
	In the face of such a situation, I look forward to hearing from the Minister that the Government will publish—and when it will publish—a detailed response to the conclusions of the UN panel, with a commitment fully to investigate allegations made against UK companies and individuals. Will the Government press Uganda and Rwanda to do the same and press both to respond to the recommendations of the report by the International Crisis Group, The Kivus: The Forgotten Crucible of the Congo Conflict; and press Uganda to publish the report of its Porter Commission and to act on its findings? Will the Government work with others to ensure that the UN, through the Security Council, responds fully and imaginatively to its panel's report? What will happen if, on 24th June when the panel's latest mandate expires, there is still defensive argument about its findings?
	On the issue of the availability of arms, and of arms of increasing power and sophistication, I welcome in the Government's export control Bill the inclusion of the DRC among "embargoed destinations" for arms sold from the UK or by UK nationals based elsewhere. But will the Government go further, as the US and others have done, and introduce end-use monitoring backed by real sanctions to ensure that British-made weapons sold to neighbouring countries are not sold on to the DRC?
	The UN panel regards as a necessary condition of the success of all its other recommendations, the withdrawal of foreign forces beyond their own borders, together with an end to their arming and supporting a range of Congolese proxy forces. It makes detailed proposals about the tracing and closing off of the channels through which the DRC's minerals, and the wealth that they create, are siphoned into world markets and the pockets of individuals, companies and states. There are questions here for the UK, for the EU and for the UN.
	What steps are the Government prepared and intending to take—and in what timescale—to impress these requirements on Rwanda, but also to discourage the Kinshasa Government from arming and supporting groups in the eastern DRC which Rwanda understandably perceives as threats to its security? Are the Government pressing Uganda to withdraw its substantial forces from Ituri where they may, for the moment, be providing some fragile security for at least some of the people, but where their presence is a provocation to Rwanda and promises nothing in the way of a longer-term contribution to the security of the region? What more can be done to reduce the very real risk of conflict within the DRC between these two neighbours?
	Uganda recently asked for a "neutral force" to keep the peace in Ituri. But neither Uganda nor Rwanda have been keen to see the UN Force MONUC strengthened, whether in numbers or in mandate. Yet, to many observers—as to many Congolese who spoke with me—it seems imperative that MONUC should be strengthened in both respects urgently and with a stiffening of major power participation and determined leadership, both so that it can be more proactive, flexible and imaginative within its present mandate and so that it deploys very much closer to the Congo's eastern border, and in numbers sufficient to reassure ordinary people by beginning to provide some basic order and security. In these regards, for what are the Government, in concert with others, prepared to press? And in what timescale?
	The Ituri Pacification Committee has barely started what could be its critically important work. As a matter of urgency, are the Government seeking to ensure that it is properly resourced and that it has an excellent chairman; and that, among its priorities, it attends to the need for justice to be seen to be done after so much killing and destruction? Within that, proper attention should be paid to the appallingly brutal treatment of women which is increasingly a feature of the conflicts in Ituri and, indeed, much more widely in the DRC.
	Finally, will the Government respond positively to the request of the all-party parliamentary group that they publish a regional strategy paper expressing a set of positions and proposals agreed between the FCO and DfID, and initiate a regional conference? Will they develop a common wish-list and a stronger partnership with France, Belgium, and the Netherlands in particular, so as to be able to pursue this whole range of questions effectively, both in the EU and in the UN?
	Let no one think that the current concentration on Iraq can justify postponing attention to the crying needs of the DRC and of the Great Lakes region more widely. I end with some words from a comprehensive and profoundly depressing report published last month by Amnesty International under the title, DRC: on the Precipice–the deepening human rights and humanitarian crisis in Ituri:
	"The scale of the tragedy in Ituri is appalling, but the situation could worsen, and sharply so . . . Amnesty International are convinced that a greater sense of urgency is needed on the part of the international community if the possibility of an uncontrollable human rights disaster is to be averted . . . Without decisive action, there is no end in sight to the tragedy being suffered by the Congolese civil population in Ituri".
	I should add that there are signs that the situation further south in the Kivus is moving in the same direction.

Baroness Park of Monmouth: My Lords, we owe the right reverend Prelate much thanks for initiating such an important debate. What pressure can the UN and the world in general exert on the African Union, I wonder, which purports to represent the African countries and to have its own humanitarian organisations—all the stronger, no doubt, because Libya, by the act of the African Union, has become head of the UNHCR? What about its organs devoted to the promotion of good governance in NePAD? What, in particular, should the UN be urging both President Gaddafi and President Mbeki to do to end President Mugabe's monstrous exploitation through the Zimbabwe army and, indeed, his ministers, of the Congo's assets? What should the UN and the AU be saying to them, and, of course, to Uganda and Rwanda, about the impact of the plunder of a country on the people?
	Where, I wonder, do the French stand? They have longstanding local interests, and longstanding local pressures. I have seen very little reference to them in the report. I find that interesting, and shall return to the issue.
	I am also concerned about the desperate need for us to address the humanitarian crisis because the displacement of millions of people in that vast country has been internal: they do not count as refugees. Because the UN presence there has been largely to observe and negotiate, there is no safe environment for NGOs, although that has not stopped Medecins Sans Frontieres and Merlin, among others, from operating.
	I must declare an interest as the patron of a very small charity, Action Congo, which succeeded another, International Care and Relief. For some years, the latter ran a hospital and an agricultural scheme teaching 200,000 Africans to grow food, as well as a primary school—all in a desperately poor area in Manono, a former mining town. There was no work there, no public services, and no infrastructure whatever.
	I went to the Congo first in 1959 accredited as Consul to both the French and the Belgian Congo, as it then was. I served there until 1961. I was there for independence; I was there for the mutiny and the collapse of the country. Why, you might ask, was a vast, rich country so wholly unprepared for independence and so utterly without any infrastructure? It is because the Congo was ruled by the Union Miniere, the para-statal bodies, and the Catholic Church. The Union Miniere wanted only workers able to read and write at primary level, so primary education up to the age of 11 was good, though Flemish was perhaps a strange choice of foreign language for a country bordered by anglophone and francophone countries.
	There was not one indigenous civil servant when I went to the Congo in 1959, no doctors, no lawyers—indeed, no professional people. There were not even senior NCOs in the Force Publique, which controlled the country and put down fairly frequent tribal wars. The only thing that the Belgians taught effortlessly was corruption. So when after the mutiny the Belgians fled the country there was no infrastructure, no public service, nothing but warring tribes and shifting allegiances.
	I had many friends among the leaders, from Lumumba to Mobutu, then a young, brave and honourable man. But successive Congolese governments were like rows of front doors with no house behind. So when the locusts came in numbers, after years of disorder and loss of hope, the people had no protection, and still do not, other than tribal leaders, each with his own cohort of unpaid and ruthless soldiery only good for despoiling their own people, not protecting them.
	I have had a story from missionaries in the Katanga about the return of the brave Congolese army to a particular area which had been devastated by the Tutsi. What did the army do? It was welcomed by the people. It gathered them together and made them take off all their clothes, what they had left to wear. It burnt the clothes, laughed and went away. That is what it did for its own people.
	It would have seemed quite natural to Kabila to join with Mugabe and his generals to despoil his own country, so a solution to that problem has to be found. Can the UN do it? Can it, with the EU, force the African Union to do something for good governance and against organised pillage? It sees to me that the Congolese Government is where we have to start. I doubt it, but we must urge the necessity.
	It will not be enough to identify all the chief robbers, if they are allowed to continue. For what will be the point of the UN and the EU investing money and resources at one end while the country's life blood is systematically draining away at the other and that continues unchecked? It will not be easy to create an efficient and honest public service after 43 years of chaos. For when the Belgians went in the 1960s everything collapsed. There were no public services. The Congo is a vast, rich and diverse country, with some wonderful people—and some who are irredeemably violent and corrupt.
	What has all this to do with the very full and terrible UN report, the follow-up to the first? My object is to urge that, although the report is extremely valuable in identifying the individuals who have conducted the systematic pillage of another African country, we must also consider and fear the long-term effect on the countries which have perpetrated this. I think, for instance, of the Zimbabwe army, which has come to believe, thanks to this experience, that pillage, corruption and brutality are normal, with terrible consequences for its own people when it returns home.
	I hope that the men and the organisations named will be publicly called to account, both in the UN and in the EU—and, indeed, in the Commonwealth. The report should leave European governments no excuse not to sequester their assets where possible. Again, I say that the French are the big question mark.
	What action do the British Government intend to take to curtail, if not end, the activities of British subjects and companies? I do not know whether the UN report is based on sufficient proof for action. The UN is in a slightly odd position in that it can freely say things without having to answer for them. That may be a problem. But the UN report appears to be based on sufficient proof for action, and the detail is careful and convincing, particularly in its identification of elite networks and its recognition that there has been, apparently, a great deal of criminal activity.
	Will it be possible from the Congo end, I wonder, to make it a condition of any UN or EU help that the new contractual arrangements set up—I refer to paragraph 17 of the report—to continue in the longer term shall be abrogated? For the Government of the Congo are at least as guilty of harming the interests of their own people as the Zimbabwe Government and the Uganda Government. A daunting feature of the report is the complicated international network of companies, involving even Mauritius.
	I hope that another area, that of the environment, given the destruction of the valuable timber forests and the impact on animal life, will not be neglected either.
	I fear that I am not optimistic about the country's stability, nor about the political will of the outside world—it is a very large task—let alone the local players and their chance of achieving peace. It is not easy to create a public service from nothing. But it is encouraging that the UN has grasped so many nettles with such vigour, and I hope that it will do all Africa some good.I should like to read to your Lordships an account which the intrepid director of Action Congo, who has twice been back to Lubumbashi, once at her own expense, and into the interior, received from one of the workers in Manono. This is an account of what happened in May 1999 when the war came to Manono. The children were on the way to school, the parents on their way to work. Others had left to cultivate their fields 17 kilometres or more out of the city.
	"As the war escalated the children on their way to school were not able to return to their homes, and in the same way, their parents were unable to return home to get their children. Parents and children trying to reach their homes were killed by the Rwanda Army and Mobutu rebels fighting with the Army. Others, who found themselves wakening at home, fled naked. The people who were consoling the families whose members had died, left the dead bodies as they were at the entrance to their homes.
	The old persons who were not sufficiently strong to flee were abandoned, as were the blind, while the sick who were hospitalised and those who had been operated on the day before the war started, who had not been collected by their families, tried to flee also . . . one blind woman managed to walk more than 400 kilometres, and finally was helped to arrive at Lubumbashi 750 kilometres from Manono. In view of the Rebels and the Army having taken Manono completely, the military of Zimbabwe, pitying the little children, the old, the blind and the deaf (about 3,000 people in all) took these children and the elderly, etc, and put them into a large Catholic school for their security. The Rwandan military arrived and found the children and the old people in the school. Immediately, they started firing with their heavy guns into the school, and burnt down the school with everyone still living inside it.
	Large numbers of the people who fled fell dead on the road from exhaustion, for the lack of food, medicines, shelter and clean water, and on account of sickness, such as malaria".
	I shall not continue, but the director received another note a year later. She notes:
	"A few months ago, some of the Manono people being desperate to grow food for themselves and fearful of likely death in the Lubumbashi, as well as finding the Lubumbashi cold and therefore causing illness, walked back to Manono (800+ kilometres). The Rwandan Army there killed them all".
	That is what life is like in that large, rich, potentially wonderful country and it is an utter disgrace.
	As there is just time, I might tell your Lordships two stories. When I was in the Congo at the independence celebrations, we had representatives from Uganda, Nigeria, Tanzania and Kenya. I arranged for them all to meet the Congolese ministers. Two nights after they left, when they were facing their future which was still quite rosy, three of the ministers came to see me in the middle of the night. They said, "We wish to become a British colony". I said, "That is rather difficult, because you have now become members of the United Nations and you are an independent country. Why do you want to become a British colony?". They said, "Well, because we have talked to all those others and they have organisation. They have been taught things, they have a government and they know how to run their lives. We have none of that, so we thought we would like it. Will you please ask for this?". I need hardly tell your Lordships that it was not feasible.
	Since I am in the business of paying tributes to the British—and why not, passionately believing, as I do, that we were good colonisers?—the country was beginning to get a little uneasy. People were beginning to realise that the future was going to be difficult and strange. The vice-consul in what was then Stanleyville and is now Kisangani sent me a message to say that I was urgently required there and would I go up. So I flew up and it turned out that a delegation of shopkeepers, Cypriots who had fled from Cyprus having committed crimes against the British Army and murdered a few people, had settled in the Congo and were leading a happy and fruitful life because as well as being shopkeepers they were money lenders. They were therefore not popular. They said to me, "We would like you to make representation to arrange to take over this country as a British colony". I asked, "Why?", and they said, "Well, the British know how to run independencies and they know how to run African countries, so we would like you to do this instantly".

Baroness Crawley: My Lords, the noble Viscount, Lord Simon, is not feeling well. I beg to move that the House do now adjourn for five minutes.

Moved accordingly, and, on Question, Motion agreed to.
	[The Sitting was suspended from 9.5 to 9.10 p.m.]

Baroness Park of Monmouth: My Lords, I shall conclude with one last story. It is not funny, but it is relevant. Robert Gardiner was a very great Ghanaian who ended his career as the chairman of the Economic Commission for Africa. He was also in charge of UN operations in the Congo for a while. The UN in the Congo at that time was the biggest disaster one could imagine.
	I often wonder what would have happened if, after initially agreeing, the UN had not prevented us from training officers for Lumumba. Immediately after the mutiny, when 6,000 Belgians had fled overnight and the country was in turmoil, Lumumba sent Mobutu to me to ask whether the British would train some officers for their army, which was totally out of control. The British government agreed and we cleared it with the United Nations. But, by September, when the army officers were due to go to Britain, a new head of UN operations, Rajeshwar Dayal, had been appointed. He represented strongly to the Secretary-General in New York that it would be a disaster if the wicked British colonialists were allowed to train their army. Therefore, the aeroplane that was at the airport waiting to take these officers to England was cancelled and they were never trained. That was a sad incident in history.
	Robert Gardiner once said to a group of young Africans who were about to become diplomats that the British gave two great things to Africa—the English language and the rule of law. The sad thing is that the Belgians left neither the rule of law nor any kind of infrastructure. The reason for all the trials and tribulations that we are now discussing, and the reason that the Congo—a rich country which is bursting with life, people and vitality—is in such a terrible state, is that it was left with no infrastructure and no rule of law. I hope that somehow, sometime, we will be able to help to restore them. That will be one of the UN's major tasks eventually.

Lord Avebury: My Lords, I join the noble Baroness, Lady Park, who it is always a privilege to follow on these occasions because of her immense knowledge of southern Africa, in the hope that we shall get our act together and do something positive for the people of the DRC in their hour of need, and help them to take advantage of the opportunity arising from the peace agreement which has recently been signed in Sun City.
	I join in the thanks that the noble Baroness expressed to the right reverend Prelate. He has given us the first opportunity we have had, in either House, to look at the report of the United Nations panel. In my opinion, it has done an excellent job in exposing the criminal networks that operate under the protection and sponsorship of the various armed groups and of the many countries which have been mentioned, in particular, Zimbabwe, Uganda and Rwanda.
	As has been said by both the right reverend Prelate and the noble Baroness, the DRC is potentially an immensely rich country, but the sums of money which are being syphoned off by the gangs which operate under the protection of its neighbours are enormous. In the government-controlled area, for instance, the report states that 5 billion US dollars-worth of assets have been transferred from the state-owned mining sector to the joint Zimbabwe-DRC kleptocracy in the past three years, and that the ZDF was planning to deploy a private military company, under its control, to protect its investment after its troops had withdrawn.
	As we have heard before, the key players at the Zimbabwe end of the network are Emmerson Mnangagwa, the Speaker, General Vitalis Zvinavashe, the commander of the ZDF and executive chairman of COSLEG, the joint venture formed between Zimbabwe and the DRC to steal the people's assets, and Air Marshal Perence Shiri, who is said to be engaged in illicit diamond trading in Harare.
	The report mentions a number of people living in the UK, and companies either registered here or effectively conducted from this country, which are alleged to be involved in the theft of resources from the DRC. Oryx Natural Resources, for instance, although registered in the Cayman Islands, is chaired by Dr Issa Al-Kawari, a London-based businessman who is said to manage the finances of the deposed Emir of Qatar.
	The panel makes a number of detailed allegations about this company, and recommends placing financial restrictions on it. The company, in turn, has denied all the allegations—as it would—but the panel has given some evidence, particularly in support of the allegation that the 49 per cent interest in Sengamines, which operates a 720 kilometre square mining concession south of Mbuji-Mayi, is held on behalf of OSLEG, the ZDF investment vehicle. According to the Sengamines' website, the state mining company, MIBA, contributed its mining concessions, the DRC a regime favourable to investment, and Oryx the finance and expertise. On this one venture alone, the state has given away a concession said to be worth more than £2 billion, as company officials have told the UN, and received back a shareholding of only 33 per cent.
	The problem in getting a comprehensive and transparent investigation of the allegations against Oryx or, indeed, any of the other 12 companies that are named in the report as being in breach of the OECD guidelines for multinational enterprises, is that the UN panel has legal privilege, as the noble Baroness, Lady Park, has told us, but discussion outside the framework could attract legal proceedings. Oryx has challenged the UN panel to repeat its allegations in some public forum, but at the same time the company says that it is looking for a jurisdiction where the allegations could be tested by legal action taken by the company itself.
	I asked the noble Baroness, Lady Amos, on 28th May last year, at col. 1143 of Hansard, whether it was the intention of the Security Council to publish the evidence on which the panel based its findings. I repeat that suggestion now; I gave the noble Baroness, Lady Crawley, notice that I would do so. If the documents were made available, either on the UN website or in some other form, together with any comments that the companies and individuals might care to submit, the general public would be able to evaluate the allegations for themselves. I mean by that not the public in this country particularly but in the countries concerned, primarily in the DRC, whose assets are being stolen.
	In the case of the UK companies said to have violated the OECD guidelines, I hope the noble Baroness will have time, on some other occasion if not today, to study the suggestions that are made in the paper I sent her on rights and accountability in development. It gives some extremely practical proposals as to how the panel's allegations should be pursued, which would form a suitable model for the next steps to be taken.
	I am, I think, the only person in the UK to have formally made a submission to the UK national contact point for observation of the OECD guidelines. I would be very happy to act as intermediary if the panel wishes to have its charges against UK companies properly considered by the authorities. I would be grateful if the noble Baroness would either facilitate an application to the national contact point for the panel or suggest that it looks for a suitable intermediary in the United Kingdom to make such a submission on its behalf.
	The UN panel makes it clear that most of the problems in the east and north of the DRC are caused by foreign intervention, particularly by the evil coalitions of senior military pirates from Zimbabwe, Rwanda and Uganda, with Russian and Lebanese businessmen. All the well known villains of the previous report star in these pages as well: John Bredenkamp, the Zimbabwe sanctions-breaker who continues to enjoy his millions here in Britain, in Sunningdale; Victor Bout, to whose gun-running activities the authorities in the UAE turned a blind eye; and Major General James Kazimi, who committed perjury before the Porter Commission in Uganda. These people, and their militia allies on the ground, have created a machine systematically to plunder the resources of the country, and to use the local administrations as a further means of extracting wealth from the people while denying them basic services. The Red Cross and other international humanitarian agencies have had to step in and provide clean water in Kisangani, for instance, at the same time as billions of dollars are being siphoned abroad to line the pockets of an evil multinational mafia.
	The UN panel makes a number of recommendations, which, so far as I am aware, have not yet been considered by the UN Security Council. The latest resolution, of 20th March, contrasts the progress made at the meeting of Congolese parties in Pretoria on 6th March towards a transitional government for the whole country, and the frightful atrocities in the Ituri area—which we have heard about already—graphically described by Amnesty International in a report published the week before last, to which the right reverend Prelate referred. Bunia, the regional capital, is under the control of the UPC, which, of course, is not a signatory of the Pretoria Agreement.
	The Security Council did not address the unanimous demand made by the Pretoria meeting for a UN force to help to guarantee the security of the population during the two-year transition to democratic elections. It asked the Secretary-General to increase MONUC's human rights personnel, but I wonder whether that is likely to be effective if nothing is done about the causes. If Kosovo was a threatened major humanitarian catastrophe, the DRC is an actual catastrophe, and a few more human rights monitors are not going to be the answer. It is reported that the Ugandan army has returned to Bunia and intends to stay there until 24th April—the latest date for the coming into operation of an Ituri pacification commission. But the AU's Third Party Verification Mission says that Uganda is in breach of the Lusaka agreement and must withdraw its troops. I think that should be the firm demand of the United Nations and of all the countries which are concerned with the position in the region.
	With regard to conflict diamonds, the Interlaken declaration of November last year approved an international certification scheme for rough diamonds, but several of the DRC's neighbours did not sign, particularly Rwanda, but also Uganda, Sudan and Central African Republic. Would it not be feasible to embody the Kimberley process and its certification scheme in a mandatory Security Council resolution, and, if not, are there any levers that we can use with President Kagame to persuade him to sign?
	What was billed as the final session of talks to adopt peace and power-sharing arrangements in the DRC came to an end yesterday with the signing of an agreement by rebel and government leaders on a two-year transitional government leading to democratic elections. Although all the rebel movements were said to have accepted the deal, the Mayi-Mayi immediately voiced objections to it, and at the very same time MONUC premises were being attacked. We echo the UN Secretary-General in thanking President Thabo Mbeki and Sir Ketumile Masire, the facilitator, for the work that they have done so far, but we also agree with him that much the hardest part is yet to come.

Baroness Northover: My Lords, I, too, should like to thank the right reverend Prelate the Bishop of Winchester for introducing this very important debate.
	It is debates like this that return our attention to some of the most insuperable problems in the world today. It is, indeed, too easy, when there are such pressing events as the war in Iraq, to focus on that alone and forget all the other areas that should demand our attention.
	In his profound and wide-ranging account, with great clarity the right reverend Prelate described a desperate situation in which tribal warfare has been fanned and encouraged so that the country can be plundered. As he says, it is an uncontrolled human rights disaster. And yet the UN is playing a key role in exposing that. But, as he says, the UN findings must be followed up and implemented, and this is the challenge that must be put to the Government tonight.
	The DRC could hardly be in a worse situation. Genocide reigns supreme, not international law. Contributing to and exploiting that situation are individuals and governments whose real reason for involvement in the country is, as we have heard, to plunder its rich resources.
	As we have also heard, yesterday a peace deal was signed in South Africa which includes a new constitution and a power-sharing administration which is supposed to oversee in two years' time the DRC's first democratic elections since 1960. But neither President Joseph Kabila nor the MLC rebel leader personally signed the peace deal. As Kofi Annan, the UN Secretary-General, said, the most difficult times lie ahead. He went on to say that:
	"No one must imagine that this deal will implement itself".
	If the deal is to mean anything, it will need to be backed up by international will.
	The country is in an appalling state. The BBC's reporter, Mark Dummett, today described for the BBC's "Network Africa" programme the scenes of utter devastation he witnessed on a 40-kilometre stretch of road out of the regional capital, Bunia. Fresh graves had been dug at the roadside and all the villages he passed had been burnt out. Villagers showed him several mass graves, and that is typical. In many areas, journalists and international monitors cannot visit because of the lack of safety.
	The DRC shares many of the problems of other African countries: extreme poverty, HIV/AIDS, high levels of disease—at the moment it is afflicted by an Ebola fever epidemic—poor sanitation, inadequate drinking water supplies, lack of infrastructure and huge levels of ethnic conflict. But it has its special burden. As the All-Party Parliamentary Group on the Great Lakes Region and Genocide Prevention put it in its report in November 2002, the DRC is "cursed by riches".
	The DRC is rich in mineral reserves. That wealth should lay the foundations for its people's prosperity, but it has had the opposite effect. It has been at the root of many of the country's problems. It has meant enormous strife as other countries and other groups have tried to lay their hands on the DRC's gold, diamonds and other resources. Thus there have been armies in the DRC from Uganda, Rwanda, Angola, Zimbabwe, Namibia and Burundi. Child soldiers have been used on all sides. In some areas, aid workers report that children form the bulk of the armies. The conflict has left 3 million people dead, while disease and abuse are widespread. There are reports of cannibalism.
	The UN panel of experts referred to by other speakers in the debate was established in June 2000 to consider the illegal exploitation of natural resources and to consider in particular the link between that exploitation and the continuation of the conflict. The panel concluded that foreign armies were using the conflict as an excuse to continue exploiting resources and that this was taking place, "at an alarming rate". Army commanders, businessmen and governments were all exploiting the situation. It recommended sanctions against both countries and individuals. In October last year, the panel concluded that there had been a multi-billion dollar corporate theft of the country's mineral assets. It pointed to a network of senior military people, businessmen and government officials in the various foreign governments and in the Government of the DRC, acting together to continue that exploitation.
	Those groups have not disbanded as the armies withdraw, so that the peace processes still leave in place terrible exploitation. As my honourable friend and colleague in another place, Norman Lamb, asked on 5th March in the debate he led on Rwanda and the Great Lakes region: what is the UK Government's response to that UN report? The right reverend Prelate echoed the question in his remarks.
	The UN report recommends travel bans, asset freezing and banking restrictions on those they have identified. Again, as my colleague Norman Lamb asked, and as my noble friend Lord Avebury has expanded on, given the extensive business connections with this country, what action are the Government taking to follow those recommendations about individuals closely connected to the UK, and what is the time scale for that action?
	What action do the Government intend to take against countries involved in the conflict in the Congo in terms of development assistance? The noble Lady, Baroness Amos, said on 4th March:
	"In the light of the panel's findings, Her Majesty's Government will consider taking appropriate action where there is clear evidence of wrongdoing".—[Official Report, 4/3/03; col. WA 95.]
	Will the noble Baroness, Lady Crawley, expand on what was meant by that, when such action might be taken, and what clear evidence is being asked for? Will she now take up the offer of the services of my noble friend Lord Avebury in that regard?
	In addition, the noble Lord, Lord Bach, referred to reservists being called up,
	"to support operations in Sierra Leone and the Democratic Republic of the Congo".—[Official Report, 4/3/03; col. WA 101.]
	Could the noble Baroness, Lady Crawley, fill us in on what operations are taking place in the DRC with the assistance of the British Army?
	Whatever the role of the British military, it is clearly essential that the United Nations has sufficient resources so that it can play a peacekeeping role. The noble Baroness, Lady Park of Monmouth, gave us in many ways a very pessimistic account based on great experience of the DRC. However, she too would seem to credit the UN as offering the only ray of hope that seems to be on the horizon at the moment. Only with some form of order will it be possible even to begin on the reconstruction of the country, building its infrastructure and setting in place programmes aimed at creating jobs and improving conditions for local populations, especially in relation to education, health and sanitation. That seems far distant in terms of the situation in the DRC at the moment.
	At the Labour Party conference in 2001, the Prime Minister described Africa as,
	"a scar on the conscience of the world".
	As he promised to concentrate on Africa, so he promised to concentrate on Afghanistan. He now says that he will concentrate on Iraq and the Middle East. I have no doubt that he means what he says, but the danger becomes the difficulty of one problem eclipsing another. It is therefore essential that we do not let that happen.
	At a time when the UN itself is under much attack and seems almost rent asunder, that the ray of light in the DRC is the result of the UN's actions shows how important it is that we value what the UN can do, and that we ensure that it is further strengthened. The debate is a very sobering reminder of the key role that international law and international bodies must now play.

Lord Astor of Hever: My Lords, I too congratulate the right reverend Prelate the Bishop of Winchester on raising this very important issue. I am only sorry that the debate has taken place so late on a Thursday evening, resulting in two very well informed speakers having to withdraw their names. I also congratulate the right reverend Prelate on an excellent and very moving speech on a tragic subject that is dear to his heart and that of his diocese, which has very close contact with the DRC, Uganda and Rwanda. He presented a chilling picture of the horror taking place in the DRC.
	My noble friend Lady Park of Monmouth also knows the Congo very well. She spoke with great authority on the background to the present-day problems and on what life is like today in what was once a very rich country. I always listen very carefully to the noble Lord, Lord Avebury, on such matters. The examples that he gave of how and by whom enormous sums of money are siphoned off were truly shocking. I look forward to the Minister's reply to his important question.
	I have been concerned for some time about the apparent failure of Her Majesty's Government to take any serious action in response to the report by the expert panel. The right reverend Prelate said that the dreadful situation is of a scale and urgency that requires much more action than the Government have yet committed themselves to deliver.
	According to the UN report, as several noble Lords have pointed out, the humanitarian consequences of what is essentially a financially driven conflict in the Great Lakes region have been horrific. The panel says that in the five eastern provinces of the DRC alone, the number of deaths directly attributable to the war up to September 2002 was estimated to be between 3 million and 3.5 million people.
	In view of recent world events, it is important to bear in mind that the panel was commissioned to carry out its work by no less a body than the Security Council of the United Nations. At this juncture, Her Majesty's Government cannot afford to dismiss lightly recommendations and resolutions that emanate from that council. To be seen to drag their heels, or to take action only unwillingly, weakens the position of the UK when the time comes to criticise the tardy response of other countries to our resolutions. I agree with the noble Baroness, Lady Northover, that the UN is playing a key role in drawing attention to the full horror of the situation in the DRC.
	Resolution 1457, which was adopted unanimously by the Security Council on 24th January, gives the panel the mandate to collect information on the,
	"actions taken by Governments in response to the panel's recommendations",
	and urges all states to conduct their own investigations,
	"including, as appropriate through judicial means, in order to clarify credibly the findings of the Panel, taking into account the fact that the Panel, which is not a judicial body, does not have the resources to carry out an investigation whereby these findings can be considered as established facts".
	While that resolution is dated January 2003, the panel's process of investigation has been under way since 2000. However, on 4th March, as the noble Baroness said, the noble Baroness, Lady Amos, could claim only:
	"In the light of the panel's findings, Her Majesty's Government will consider taking appropriate action where there is clear evidence of wrongdoing".—[Official Report, 4/3/03; col. WA 95.]
	While Her Majesty's Government appear to have been dithering, the response of some other countries to the report has been admirable. The president of the DRC, Joseph Kabila, suspended several key government officials named in the report, including some of the most powerful figures in his government as long ago as November 2002. He also recalled his envoy in Harare, who had been implicated.
	In Uganda, as the right reverend Prelate said, the government commissioned a judge, David Porter, to investigate Ugandan nationals named in the report. His findings were presented to the Ugandan Cabinet in February this year.
	By contrast, Her Majesty's Government have apparently not even instigated any serious investigation into the allegations made, still less taken any punitive action. One area that is of very special concern to me is the connection between the illegal activities in the DRC and the ringleaders of the brutal repression that is occurring further south in Zimbabwe. Several noble Lords touched on that. Companies alleged in the report to be involved in underhand deals include Oryx Natural Resources and OSLEG, which have close links to the Zimbabwe national army.
	The report demonstrates a very clear involvement by the corrupt regime of Robert Mugabe's ZANU-PF and the plunder of the DRC's natural resources. Time and again Ministers have tried to give the impression of despair and that there is so little they can do to influence events in connection with Zimbabwe. But here is an opportunity handed to them on a plate and they have failed to take it.
	Annex 2 of the report lists the names of,
	"Persons for whom the Panel recommends a travel ban and financial restrictions".
	Two of those persons, Thamer al Shanfari and John Bredenkamp, spend time in the United Kingdom and, as has already been said, have business interests here. Annex 3 lists,
	"Business enterprises considered by the Panel to be in violation of OECD Guidelines for Multinational Enterprises".
	One of those businesses listed, Avient Air, is according to the report, managed by Andrew Smith, a former British Army captain. He is also reputed to operate businesses from within the United Kingdom.
	The time has come for Her Majesty's Government to take these matters seriously. We cannot lecture African nations on the need to deal with corruption and illegal business deals if we are not prepared even to investigate well founded allegations that are made against those who operate from within our own jurisdiction. I hope that the Minister will be able to tell the House that serious investigation, with a view to punitive action where necessary, is now under way.

Baroness Crawley: My Lords, I am very grateful for this stimulating and constructive debate and thank noble Lords for their contributions. I will ensure that any answers to noble Lords' questions that I do not cover tonight are sent in written form. I also thank the right reverend Prelate the Bishop of Winchester for giving us the opportunity to discuss these topics, and for his important contribution to the very positive role the Churches are playing in the DRC.
	The debate has covered not only the important subject of the final report of the UN Panel of Experts on the Illegal Exploitation of Natural Resources in the Democratic Republic of Congo, but it has also given us an opportunity to debate recent events there that are of concern to noble Lords.
	The Lusaka agreement in 1999 effectively brought to an end the conventional fighting between the various Congolese armed groups and their foreign backers. But the foreign armies stayed in the DRC. The no-peace no-war stalemate that ensued, and which has been referred to by many noble Lords, benefited no one except those able to exploit the situation. Many did, including the foreign armies and almost all of the Congolese participants in the conflict. So, too, did the "criminal elites" referred to in the last report of the UN expert panel. Despite the stern strictures of the noble Lord, Lord Astor of Hever, to us, in an otherwise excellent contribution, I assure noble Lords that the Government fully support the UN expert panel in its work on the illegal exploitation of the many and varied natural resources which the Democratic Republic of Congo possesses. The noble Baroness, Lady Park of Monmouth, from her great experience of the Congo, mentioned in particular the shameful role of Zimbabwe in that exploitation.
	It highlights the need for proper and transparent regulation of the extractive industries of the DRC, which holds the key to the regeneration of the country's economy. The UN expert panel report highlights mismanagement and corruption in the DRC's largest mining operation, Gecamines, which has resulted in a huge slump in the contribution the company has made to the economy.
	From once earning some 70 per cent of the DRC's hard currency export earnings, Gecamines' production, so the panel report states, is now at only one-tenth of its former capacity. The noble Lord, Lord Avebury, also spoke in his powerful contribution about corruption in the mining industry. It beggars belief.
	Without that income and with the added cost of a seemingly interminable conflict the DRC could face an enormous economic crisis, even worse than it is at present. So we take very seriously the allegations in the panel's report against the 12 UK-registered companies. The report claims that those companies have been non-compliant with voluntary OECD guidelines on multinational enterprise. We asked for further information from the panel in November 2002 in order to substantiate the claims that it made. But there has been a technical hitch to which many noble Lords referred, although in terms of complacency, which I refute.
	The panel's mandate expired when it submitted its report and it was therefore unable to restart work to produce the information requested until it had been granted a new mandate. With our strong support, the Security Council Resolution 1457 of 24th January 2003 extended the mandate of the panel for a further six months. I am pleased to report that the panel reconvened on 3rd March. We have again asked for information linking British companies and individuals named in the report with illegal exploitation of natural resources. We look forward to receiving the information that we have requested and will then consider taking appropriate action where there is clear evidence of wrongdoing. The UK Government have to act objectively in this matter, but cannot do so without more robust evidence.
	This debate is also about the UK Government's reaction to recent events in the DRC. I therefore turn to the situation in the Ituri region in eastern Congo, on which the right reverend Prelate spoke at some length and which has featured in the newspapers recently, and to the peace process more generally. The eastern DRC remains violent and volatile. It is a cause of deep concern. The abuse of human rights in all its aspects, described as a disaster by the noble Baroness, Lady Northover, whether it is brutal rape, the use of child soldiers or resource exploitation, is totally unacceptable.
	Some of the violence has its own genesis and momentum deeply rooted in the historical, social and ethnic mix of the region. That is particularly true in Ituri, as the right reverend Prelate so strongly described, but also in the Kivus. However, it is fuelled by short-term military and economic interests of local warlords and both Congolese and foreign outsiders. In that respect, the recent outbreak of fighting in the Ituri region between the Ugandan Peoples Defence Force and the Union des Patriotes Congolais (UPC), the newest armed group, is very worrying.
	Last year when the Ugandans withdrew their forces from the DRC, we understood that they were asked by the Kinshasa government to stay in Ituri to keep the peace. However, since then, fighting and human rights abuses have continued. We were encouraged in February when President Kabila of the DRC and President Museveni of Uganda signed an agreement under which the remaining Ugandan forces would be withdrawn by 20th March. My noble friend Lady Amos, together with my right honourable friend the Secretary of State for International Development, urged President Museveni to stick to his part of the bargain. But the most recent outbreak of fighting could not have been more badly timed. The subsequent reinforcement of Ugandan forces suggested that President Museveni would go back on his commitment. We therefore pressed him to honour his commitment. The Security Council Resolution 1468 of 20th March 2003 called on Uganda to withdraw "without delay". We continue to reiterate that message.
	We are also giving urgent attention to a viable and neutral security force for the region. Several noble Lords referred to that. A variety of alternatives are under consideration and we are working closely with our partners in the European Union and UN to agree on the best option. We have also pressed Rwanda to show restraint and not to carry out its threat to re-enter the DRC. Law and order must be restored to Ituri, and to the Kivus.
	My Government believe that this can be achieved and that there can be an end to the violence and bloodshed.

Lord Avebury: My Lords, I am sorry to interrupt the noble Baroness. Was she going to say something about the Ituri Pacification Commission which has been mentioned by several noble Lords and which the Ugandans said would begin to operate on 24th April? Is that so; and will the Ituri Pacification Commission have a military component which will be strong enough to keep the peace in Bunia?

Baroness Crawley: My Lords, I shall write to the noble Lord. I do not have the details in my brief.
	It was agreed in Kinshasa that peace could be brought to Ituri quickly, a peace which the international community could help keep. There has very recently been progress on this front.
	The signing of the "Global and Inclusive Agreement on Transition in the DRC", which was signed in Pretoria on 17th December last year, as we were reminded by the right reverend Prelate, was a step in the right direction. But it left three main issues unresolved. They were: a new constitution, under which the transitional government would work; security in Kinshasa for members and institutions of the transitional government; and the formation of a new national Army.
	On 6th March, in Pretoria, the Congolese parties reached an agreement on the constitution. Negotiations continue on the remaining two issues. This allowed for a final plenary of the Inter-Congolese Dialogue, which concluded yesterday, and which should soon be followed by the formal installation of the transitional government. We look forward very much to this event. I would like here to give tribute to the hard work of those whose efforts have brought about a chance of real peace for the DRC.
	As soon as there is an agreed, legitimate transitional government in Kinshasa, we are keen to play our part in helping the Congolese to rebuild the DRC, in the same way as we have been helping the Tanzanians, Ugandans and Rwandans to do so in their countries. We have offered to play our part in enabling the establishment of a reformed national army, drawing on the forces of the Kinshasa Government and the armed groups. We will also be helping with the enormous task of demobilising the tens of thousands of combatants who have taken up arms during the conflict. We have pledged 25 million US dollars over five years to the multi-donor regional demobilisation and reintegration programme in the Great Lakes.
	Perhaps I may refer to some of the questions raised. If I do not answer them all, it is because we are running close to time. I shall ensure that all noble Lords receive answers. The right reverend Prelate the Bishop of Winchester asked when the UK will publish a response to the UN panel's report and whether we shall press Uganda and Rwanda to do the same. We intend to respond to the UN panel's report as soon as the UN provides information that we have requested.
	I was also asked what the UN is doing about allegations in the panel report against Uganda, Rwanda and Zimbabwe. We welcome the Porter Commission set up to investigate the allegations made in the UN panel report specifically about Uganda. We await publication of the commission's report with interest. We have encouraged the Rwandan Government to respond positively to the UN panel report. We have limited scope to encourage Zimbabwe to take seriously and respond to the allegations of the panel report.
	Where a UK connection is clear, it would be possible to consider action in the light of the nature of such a connection and the strength of the information supplied by the panel during its work during the coming months. Where there is robust evidence, we will take what action we can.
	The right reverend Prelate also asked whether Her Majesty's Government will press to strengthen MONUC. We fully support MONUC's activities. If any new mandate is required to bring peace and stability, we would support it. He also asked what the UK is doing to control weapons entering the DRC. We continue to uphold the EU arms embargo imposed in 1993, which bans the export of military equipment from the EU to the DRC, and to examine all export licensing applications against our national criteria and the European Union code of conduct. Similarly, we are upholding the UN embargo on the sale and supply of arms to non-governmental forces in Rwanda, which also applies to the sale and supply of arms to neighbouring states, if they are for use in Rwanda.
	The noble Baroness, Lady Park of Monmouth, the noble Lord, Lord Avebury, the noble Baroness, Lady Northover, and the noble Lord, Lord Astor of Hever, asked whether we would take action on the evidence of the report against UK companies—what sanctions the UK might take. Where there has been a clear breach of UK law, such a breach could be persecuted—I mean prosecuted; they feel persecuted when they are prosecuted—under the relevant legislation.
	Where there is an alleged breach of OECD guidelines, we would review the allegation and take appropriate action. We would also consider other mechanisms and measures to prevent a recurrence and to strengthen control to prevent further illegal or unethical exploitation of natural resources. I shall write to noble Lords about the timescale.
	The noble Baroness, Lady Northover, asked about UK support for security sector reform in the DRC. A joint DfID/MoD/FCO scoping mission visited the DRC in January to assess how the United Kingdom could contribute to integrating the armed forces in the DRC. We are working with European Union partners to co-ordinate our efforts.
	I thank the noble Lord, Lord Avebury, for giving me notice of his question. He asked what steps the Government have taken for allegations of breaches of the OECD guidelines by British companies to be investigated by the national contact point. The national contact point, which is the mediator between the complainant and the company, has been made aware of the UN panel's report. We are ready to take steps when a formal complaint is lodged. Such a complaint would require more evidence than is contained in the UN expert panel's report. I shall write to the noble Lord about publishing evidence. I thank him very much for his offer of mediation with the national contact point; we shall speak to him about that. As the Department of Trade and Industry is the national contact point, perhaps I may suggest that the noble Lord addresses his specific points to the Secretary of State for Trade and Industry.
	The noble Baroness, Lady Northover, asked what the UK was doing specifically about conflict in the DRC. Britain is providing people and money for the military, political and peace observation aspects of the Lusaka peace agreement. I shall enlarge on that to the noble Baroness in writing.
	I thank all noble Lords for their contributions. This has been a very important debate. The DRC—as the noble Baroness, Lady Park, said—is such a rich country, with so much that could be going for it. It is a crying shame that there is so much illegal exploitation of that country. I will ensure that noble Lords have complete answers.

House adjourned at ten o'clock.